Bank of England Denies Digital Pound Similarity to Cryptocurrency

The Bank of England has yet to determine the use of distributed ledger technology for a potential digital pound, according to Deputy Governor Jon Cunliffe’s statement.

BoE Frowns at Press Moniker for the Digital Pound

The Bank of England has expressed opposition to the media’s moniker for a potential digital pound issued by the central bank, “Britcoin.” This label can lead to confusion with cryptocurrencies such as Bitcoin, according to Deputy Governor Jon Cunliffe. He used a speech on Tuesday to clarify the central bank’s plans for a digital pound and dispel any misunderstandings.

According to Jon Cunliffe, Deputy Governor of the Bank of England, most cryptocurrencies are largely speculative with no inherent worth. He stated that, although some technology used in cryptocurrencies could aid in creating a digital pound, the bank is evaluating a variety of alternatives. While the central bank has not yet decided on the utilization of distributed ledger technology (DLT) – which is commonly used for cryptocurrencies – Cunliffe emphasized the significance of experimenting with decentralized record-keeping to guarantee it is thoroughly evaluated.

The Bank of England and the UK’s finance ministry launched a public consultation on Tuesday, seeking input on their plans for a central bank digital currency. Despite concerns from UK banks about potential bank runs, the consultation document outlines proposals to limit individual ownership of the digital currency to a range between £10,000 ($11,900) and £20,000.

England Moves Ahead With Adoption

During his Tuesday speech, Bank of England governor, Mark Cunliffe, emphasized the importance of caps in maintaining the stability of the banking system. According to Cunliffe, these caps will ensure that the outflows from the system remain within the parameters set out in the Bank’s earlier projections. He also added that the Bank is exploring the idea of allowing citizens to receive their salary and pension in digital pounds, so that the currency can be widely adopted and used for day-to-day transactions.

In addition, the Bank of England is also considering the potential use of fiat-backed private cryptocurrencies, such as stablecoins, alongside the digital pound for payments. The UK government is in the process of regulating stablecoins through the Financial Services and Markets Bill, which is set to be introduced soon. By having both digital pounds and stablecoins in circulation, the Bank hopes to offer citizens a more convenient and accessible way to make payments and manage their finances.

The Bank of England is committed to staying ahead of the curve when it comes to digital currencies and their potential impact on the financial system. By embracing new technologies and innovative solutions, the Bank aims to provide citizens with a secure and reliable means of conducting transactions in the digital age.

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