Jon Conliffe Speech: A digital pound will be needed in this decade

Bank of England | Feb 7, 2023

Speech by Sir Jon Cunliffe, Deputy Governor, Financial Stability at UK Finance event:

Jon Cunliffe says it is likely that a retail, general purpose digital central bank currency – a digital pound – will be needed by the end of this decade. He discusses why this is the case, what the model could look like and how the digital pound may sit within the digital payments landscape.

See:  MAS: Programmable Retail CBDC trials to begin in Singapore

Digital Pound consultation:  As some of you may have seen, the Bank of England and the Treasury have today published, as a Consultation Paper, the report of the Bank of England – HM Treasury Taskforce on the introduction in the UK of a central bank digital currency – a ‘digital pound’.

Our assessment is that on current trends it is likely that a retail, general purpose digital central bank currency – a digital pound – will be needed in the UK. This would be a new, digital form of money, issued by the Bank of England for use by households and businesses for everyday payments.

A digital pound would be a very substantial financial infrastructure project that would take several years to complete. However, in view of the likely need and the lead time to introduction, the Bank and The Treasury, will now proceed to the next stage of detailed policy and technical development of the digital pound – including the development of a technical blueprint.

Cash is phasing out:  In 2021 only 15% of transactions involved physical money. Technology and the increasing digitalisation of everyday life has transformed the way
we use money. Private commercial bank money accounted for 85% of the
payments made by the public.

The forms that money takes and the ways it is used have changed throughout history driven by changes in technology and the changing demands of ever more sophisticated and complex economies. However, trust in money is the bedrock on which that innovation is built.

There are already in existence new digital technologies that are being applied to the digital representation, transfer and storing of money like obligations. Programmable money, for example, could enable the development of smart contracts which carry out specific actions based on pre-defined actions and conditions.

Money and payments are no longer the exclusive province of banks. New, non-bank players have already been successful in providing innovative payment services. Looking forward a wide range of non-bank payment firms, including bigtechs and some players from the crypto universe, are becoming increasingly interested in the possibilities of these new technologies in money and payments.


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A digital pound issued by the Bank of England would provide an alternative, public, digital money – an open platform, which would be available to all developers of new digital payment services. Moreover, if designed appropriately, a digital pound could complement and support new forms of private digital money and payment services, for example by acting as the ‘bridging asset’ between different platforms enabling convertibility. By establishing technical standards available to all, it could help ensure interoperability between different platforms. Our assessment is that a digital pound, an alternative, publicly issued form of digital money, available to all, would help ensure competition and innovation and drive efficiency in payments.

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