The UK considering a Bank of England-backed digital currency called Britcoin


Britcoin
Photo by Suzy Hazelwood from Pexels

According to a report by Reuters, British finance minister Rishi Sunak revealed the UK is launching a new task force to explore the feasibility of a Bank of England-backed cryptocurrency called Britcoin.

During the UK FinTech Week Sunak said the country is launching a new task force between the Treasury and the Bank of England to coordinate exploratory work on a potential central bank digital currency (CBDC). The new task force will reportedly explore opportunities and risks of a CBDC, as well as monitor international CBDC developments to “ensure the UK remains at the forefront of global innovation.” Shortly after this announcement, Sunak tweeted a one-word question to his nearly 500,000 followers, “Britcoin?”

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In a statement released on Monday, theĀ Bank of England said that the Government and the Bank of England have not yet made a decision on whether to introduce a CBDC in the UK and will engage widely with stakeholders on the benefits, risks, and practicalities of doing so. However, if the currency is introduced, Britcoin will exist alongside cash and bank deposits instead of replacing them, the bank said.

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The UK’s central bank is not the only one to consider central bank digital currency, with China currently leading the way. The country already began developing its digital currency electronic payment CBDC in 2014 and recently tested a pilot in 2020. A new Citi report this month entitledĀ Future of Money said it expects China could see a cashless society within five years.

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