The Bank of England is weighing whether it should create a central bank-backed digital currency, according to its governor Andrew Baily
Bailey, speaking to students during a webinar, was quoted as saying:
We are looking at the question of, should we create a Bank of England digital currency. We’ll go on looking at it, as it does have huge implications on the nature of payments and society.
Bloomberg reports Bailey added that he believes in a few years “we will be heading toward some sort of digital currency.” The Bank of England, the news outlet adds, is part of a group of major central banks that are working together on assessing the potential development of central bank digital currencies.
The central banks teamed up after Facebook announced its cryptocurrency project Libra. As CryptoGlobe reported, the Bank of England has in the past recommended that central banks replace the U.S. dollar with a Libra-like digital reserve currency, when its governor was Mark Carney.
Carney’s comments came at the Federal Reserve’s annual Jackson Hole Symposium, in which he called for a dramatic shift in global monetary policy that would see central banks take a grander interest in digital currencies. He argued that proactively replacing the dollar with a digital coin substitute would be preferable to allowing another national currency usurp its status–such as the Chinese renminbi.
To Bailey, a digital currency issued by the Bank of England “will be a very big issue,” although it could take time for the financial institution to devote its attention to the currency’s development. Earlier this year, however, the Bank of England was reportedly considering launching a central bank digital currency equivalent to fiat as cash usage kept on dropping.
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