Britcoin. Sterling but not as we know it. Keeping an eye on movements towards the introduction of a new digital currency, the ‘Digital Pound’.

The Bank of England, like many Central Banks around the globe, is considering introducing a digital currency, the ‘Digital Pound’.  Central Bank Digital Currencies (CBDC) – the Digital Pound

Rather than a new currency, the Digital Pound will be a form of central bank electronic money that will stand alongside physical cash (also a form of central bank money) and could be used by households and businesses to make payments. It will act in the same way as physical cash that can be carried in your wallet, however it will most likely be in the form of a card or a phone app and could be used in the way bank cards or apps are used today.

This is being investigated now in response to the decline in the use of physical cash and the growth in alternate forms of payments such as cryptocurrencies. It’s worth noting that the Digital Pound won’t be a cryptocurrency.

While the design is still being worked on it will most likely be issued/distributed via a central platform operated at arm’s length by the Bank of England. Concerns about privacy and security which are often raised when discussing CBDCs will need to be taken seriously and addressed as key elements in the design.

Whilst it is still in its conceptual phase it’s possible we may see Digital Pound prototypes as early as 2025. We are keeping a watching brief on this as consultation continues as it could be used by customers as they interact with all sorts of businesses in financial services and beyond.

Pelicam are keeping abreast of developments in this space and we would be happy to discuss our thoughts as things develop in the UK and globally. Talk to Mark Paton on +44(0)7909 906991 or email mark.paton@pelicam.com

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