NatWest bank chairman Howard Davies has claimed that Britain will be piloting its own CBDC based on the pound to reduce money transfer costs within the next five years.
“Britcoin” CBDC In The Books?
The Bank of England (BOE) has not yet made any announcement regarding its stance on a pound-based CBDC. However, at a Bloomberg event on Tuesday, Davies expressed his belief that the UK would see a pilot CBDC initiative in the next 3-5 years. Continuing on a related topic, he addressed the volatility of crypto assets like Bitcoin and its environmentally harmful effects, claiming that it lacks inherent value and is useless beyond buying illicit transactions on the dark web.
On the other hand, BOE Governor Andrew Bailey spoke at the same event, saying that the central banks were considering the pros and cons of a CBDC.
“I don’t think the Bank of England and the UK is behind on this issue. We have to answer the question – exactly what problems are we sorting out here? We have got to be very clear on what it is that we think the digital currency will do, and what it will do to improve the system.”
Euro Or Pound – Which Will See Digitalization First?
Many nations worldwide are considering developing their own CBDC, and countries like Jamaica have already launched their CBDC pilot. Even the European Central Bank has decided to move ahead with the digital Euro program, which is not likely to be launched in the next five years. The digital pound could easily precede the digital Euro.
The UK has been toying with the idea of a CBDC for the last few years. The BOE and Her Majesty’s Treasury together launched a task force in April this year to determine the “design, implementation, and operation” requirements of a CBDC. BOE Head of FinTech, Tom Mutton, who is pushing for a CBDC future, has recently discussed at length the benefits, including promoting financial inclusivity, safeguarding privacy, and increasing payment diversity.
Brits Have Concerns Over Digital Pound
However, in a recent study conducted in August by Redfield & Wilton Strategies on behalf of Politico, the findings suggest that a good chunk of the UK adult population still have reservations and concerns over a BOE-issued CBDC. As per the survey, 30% of the 2500 British adults surveyed believed that the “Britcoin” would be more harmful than beneficial to the UK. Further analysis revealed that 73% of the participants were concerned about cyberattacks, 70% about privacy concerns, 62% about the government’s ability to seize their money, and 45% of participants were concerned about the environmental impact.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
