The Bank of England and HM Treasury have started a consultation process to decide whether the UK should go forward with creating a “Britcoin,” CBDC (central bank digital currency). In April 2021, a task force was established by the financial groups to work on the project. They committed to extensively talking with stakeholders about the advantages, drawbacks, and practicalities of such a transition.
Britcoin is seriously discussed between the UK authorities
On Tuesday, the two organizations revealed that the next phases in their research would start in 2022 and include “a consultation which will set out their assessment of the case for a UK CBDC, including the merits of further work to develop an operational and technology model for a UK CBDC,” according to Bank of England.
“It will evaluate the main issues at hand, consider the high level design features, possible benefits and implications for users and businesses, and considerations for further work. This consultation will form part of a ‘research and exploration’ phase and helps to inform policy development over the next few years.”
The Bank of England’s statement and Economic Secretary to the Treasury John Glen’s remarks do not say who will be consulted or what criteria the consultation will consider while deciding whether to continue work on a CBDC.
If the currency does emerge, both papers state that it will be “a new form of digital money issued by the Bank of England and for use by households and businesses for their everyday payments needs. It would exist alongside cash and bank deposits, rather than replacing them.”
The papers imply that Britcoin will coexist with current cash and bank deposits. It will not be a replacement.