LONDON: British finance minister Rishi Sunak told the Bank of England on Monday to look at the case for a new “Britcoin”, or central bank-backed digital currency, aimed at tackling some of the challenges posed by cryptocurrencies such as bitcoin.
A BoE-backed digital version of sterling would potentially allow businesses and consumers to hold accounts directly with the bank and to sidestep others when making payments, upending the lenders’ role in the financial system.
“We’re 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),” Sunak told a financial industry conference.
Soon after, Sunak tweeted the single word “Britcoin” in reply to the finance ministry’s announcement of the task force.
Other central banks are also looking at whether to set up digital versions of their own currencies, essentially widening access to central bank funds which only commercial banks can use at present. This could speed up domestic and foreign payments and reduce financial stability risks.
China is a front-runner to launch a CBDC. — Reuters
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