Bank of England hints there ‘could be role’ for CBDC

Two key execs at the Bank of England (BoE) have publicly spoken about the possibility of a state-run digital currency this week.

In a speech at the OMFIF Digital Money Institute in London, deputy governor for financial stability Jon Cunliffe said that the introduction of a central bank digital currency (CBDC) is likely.

“We may not be there yet,” said Cunliffe. “But it looks probable in the UK that if we want to retain public money capable of general use and available to citizens, the state will need to issue public digital money that can meet the needs of modern day life.”

The BoE’s governor Andrew Bailey also hinted at a future with a state-run digital currency.

"It may well be that we do end up with a digital currency,” Bailey said at a public event organised by the bank.

But the governor said that the cryptocurrency is “a few years off at the moment."

Bailey warned that while there could be a place for a CBDC, there are also a number of issues associated with cryptocurrencies.

The governor explained that while the use of cash is declining, a digital currency would have a big impact on the financial system and other areas.
"Security, that is an issue for us. Privacy, that's a big issue, a very big issue," he said at the event.

Bailey also said that Facebook’s plans to launch a cryptocurrency "set off a lot of alarm bells" about access to information.

In April, UK finance minister Rishi Sunak requested the bank and regulators to explore the case for issuing a CBDC.

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