The Bank of England (BoE) and HM Treasury in the United Kingdom released their response to a consultation on a central bank digital currency (CBDC) launched in February 2023, saying they intended to focus on “privacy and control.”
In a Jan. 25 notice, the BoE said “no final decision has been made” regarding launching a digital pound, but officials would continue to explore CBDC feasibility and designs. Both institutions added they intended to “protect access to cash” should they move forward with a CBDC launch, giving residents an additional payment choice.
“[I]f a digital pound were to be implemented, primary legislation would be introduced, and this would guarantee users’ privacy and control,” said BoE. “The Bank and the Government would not have access to any personal data and users would have freedom in how they spent their digital pounds.”
Today, we respond to the digital pound consultation. We are grateful to those who contributed. With @HMTreasury work continues to explore a digital pound in the design phase, but no decision has been made to issue one.
— Bank of England (@bankofengland) January 25, 2024
You can read our response here: https://t.co/h4GsMkuOpd pic.twitter.com/IwN58h7rNf
The U.K. government has been pushing BoE and HM Treasury to provide greater transparency around the potential expenses of a CBDC launch. Many U.K. residents have suggested that launching a digital pound could lead to government surveillance of financial transactions and a loss of privacy.
“[W]e would like to see much more detail from the Government and the Bank of England on this important subject including a clearer plan of action and timeline around the next steps for a digital pound,” said a spokesperson for the self-regulatory trade association CryptoUK. “As the industry continues to evolve and our members demand more certainty from regulators and lawmakers, this current lack of clarity and direction risks creating uncertainty and frustration for crypto digital asset businesses in the UK and those that want to build, invest and grow the industry.”
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The BoE and HM Treasury said they expected to launch the digital pound, referred to as ‘Britcoin’ by certain members of the public, no earlier than 2025 should they move forward with the CBDC plan. The U.K. government has undergone several changes in leadership since the digital pound was first proposed, including officials responsible for overseeing economic policy.
Across the pond in the United States, a digital dollar may be on the verge of becoming a campaign issue in the 2024 Presidential Election, scheduled for November. Though Florida Governor Ron DeSantis — a CBDC opponent who vowed to ban the currency if elected — has dropped out of the race, former U.S. President and Republican Party frontrunner Donald Trump said he would “never allow” a digital dollar to “protect Americans from government tyranny.”
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