Bank of England policy makers clash over digital pound design Bank of England policy makers clash over digital pound design
Reports have emerged that the team behind the "digital pound" at Bank of England are split over the balance between central controls and decentralized ledger benefits.
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Updated: Jun. 27, 2023 at 12:55 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
The team at the Bank of England responsible for designing its digital pound CBDC project has clashed over its core design, according to Bloomberg.
Tom Mutton, the director of fintech at the Bank of England (BoE) and head of the digital pound project, said a recent meeting failed to strike an agreement on the fundamental design of the Central Bank Digital Currency (CBDC) — namely, whether or not it should operate on distributed ledger technology (DLT).
Several design versions are being considered at this stage. But Mutton said, “None of them agreed with each other at any point” during the meeting.
Without disclosing his design preference, Mutton weighed the main arguments for and against DLT, concluding that all options remain on the table.
“We definitely want to be compatible with distributed-ledger business models in the private sector, but we were not convinced that distributed ledgers offered more efficiency over conventional ledgers.”
The BoE launched its digital pound consultation in February, seeking engagement with the public on the proposal. The consultation period ends on June 30, with the responses gathered to inform the project’s development.
Although the central bank envisions the future need for a CBDC, it stressed that no decision had been made on whether to proceed.
“At this stage, we judge it likely that the digital pound will be needed in the future. It is too early to decide whether to introduce the digital pound, but we are convinced preparatory work is justified.”
Critics have expressed suspicion over CBDCs out of concern that they would tilt the balance of control too far toward governments, central banks, or other centralized entities. For example, Chris Blec told CryptoSlate that while CBDCs are sold on efficiency and convenience, in reality, they are being implemented to “eliminate our financial privacy and micro-manage our lives.”
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Samuel Wan
Samuel Wan, a finance professional turned full-time crypto content creator, values individual autonomy and personal freedom in his pursuits.
