A central bank digital currency (CBDC) is crucial to strengthening London’s position as a financial centre following the UK’s exit from the EU, according to The City United Project.

The think-tank’s chairman Daniel Hodson told Reuters that there is now a “swelling majority” in London that think that the UK should focus on making the financial sector more competitive, rather than delaying change in order to gain EU access.

The comments come as the finance ministry is considering proposals to improve London’s attractiveness after the capital was beaten by Amsterdam as the top share trading centre in Europe.

“A central bank digital currency (CBDC) should be a fundamental foundation for a competitive City after Brexit, otherwise China will steal a long march on us,” Hodson told Reuters. “The Bank of England is talking about a CBDC but it ought to be a greater priority as this form of technology is the future, and would bring other benefits like real-time regulation to cut costs.”

The organisation, which was founded by Eurosceptic politicians, has reportedly submitted 24 recommendations for reforming UK financial services to a government taskforce.

A digital pound would enable fractions of a currency to be both spent and traced without high costs and help collect taxes in real-time, City United told the news agency.

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