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Digital currency issuance could involve private companies, Bank of England says

Wednesday 8 April 2020 05:09 CET | News

Bank of England (BoE) analysts working on the UK’s central bank digital currency (CBDC) initiative have said during a webinar that there was a distinct possibility that private companies could play a larger part in the issuance and distribution of money.

Although they might introduce new risks into the monetary system, CBDC analyst Ben Dyson said private currencies could work alongside any future CBDC initiative if they offered real utility. Nevertheless, the BoE’s views about private currencies are distinct from those of other central banks, which have talked specifically about Facebook’s currency initiative as well as the broader space, according to CoinDesk.

In February 2020, US Federal Reserve Governor said the motivation for researching CBDCs was to counter private currencies, such as libra, that could exist outside US regulation. French and German officials have also voiced their opposition to libra and said such initiatives might not even be legal in their jurisdictions. Furthermore, the Canadian central bank governor said it would only issue a CBDC in order to compete against a potential threat like libra.

Still, BoE has adopted a more conciliatory approach to libra. In August 2019, then-governor Mark Carney said that although libra would have to be heavily scrutinised, the concept of private companies issuing their own currencies was ‘intriguing’.

But as the BoE analysts also emphasised during the recent webinar, any future digital currency, including a prospective CBDC, would need to comply with tight data privacy standards.
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Keywords: Bank of England, BoE, central bank digital currency, CBDC, UK, cryptocurrency, Facebook, Libra, stabelcoin, data privacy
Categories: Blockchain & Cryptocurrencies | Cryptocurrencies
Countries: United Kingdom
This article is part of category

Blockchain & Cryptocurrencies