It will evaluate the main issues at hand, consider the high level design features, possible benefits and implications for users and businesses of a dedicated British digital currency.
No decision has been made on whether to introduce a CBDC in the UK, which would be a major national infrastructure project. In April 2021, the bank and HMT initiated the joint CBDC Taskforce to coordinate the exploration of a potential ‘Britcoin’.
The bank also set up the Engagement and Technology forums, where relevant stakeholders from industry, civil society and academia provide strategic and technical input to the work on CBDC.
The 2022 consultation will inform a decision on whether the authorities are content to move into a ‘development’ phase which will span several years.
Economic Secretary to the Treasury John Glen, said: “This consultation will begin an open discussion on the role a UK central bank digital currency might play in the UK.
“I’d encourage everyone to contribute to the discussion so we can explore the opportunities this could bring, as well as understanding any risks it may pose.”
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A technical specification would follow the consultation explaining the proposed conceptual architecture for any CBDC. This could involve in-depth testing of the optimal design for, and feasibility of, a UK CBDC.
If the results of this ‘development’ phase conclude that the case for CBDC is made, and that it is operationally and technologically robust, then the earliest date for launch would be in 2025.
Deputy Governor for Financial Stability, Jon Cunliffe, said: “The plan to publish a consultation next year on CBDC is a crucial step in our policy development, especially as we further our thinking on the pressing issues at hand.
“What it will do is provide a platform for interested parties and relevant groups to engage with the key questions on the merits of CBDC, and whether the public sector should advance to a development phase.”
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