Cryptocurrency

The UK Explores the Possibilities of a Digital Pound

As its government hires a Central Bank Digital Currency lead for its treasury team.

Cryptocurrency

The UK Explores the Possibilities of a Digital Pound

As its government hires a Central Bank Digital Currency lead for its treasury team.

On January 24, the UK’s HM Treasury posted a job listing for a “Head of Central Bank Digital Currency.” The role has become available to help further collaborative efforts between the Bank of England and the Treasury — as the two explore potential use cases of a digital pound.

“Treasury and the Bank of England have committed to consult jointly on a potential digital pound,” read the job listing, adding that “the successful candidate will lead the Treasury team in the wake of the consultation’s issuance, including working with the Bank of England to consider consultation responses.”

The digital pound in question is said to act as a UK CBDC with the work related to its development being described as “important, complex and cross-cutting,” with the leadership surrounding the project involving extensive engagement across and beyond HM Treasury.

“Digital innovation is changing the landscape for payments and money. The use of physical money is declining while new forms of private-sector digital money are emerging,” shared HM Treasury.

The Treasury sees the changes as exciting opportunities for both UK businesses and consumers alike, however, it admits that new challenges and risks are present as a result.

Already, countries from around the world, including China, The United States, Sweden, and more have begun to research and explore the potential use cases of CBDCs — though the general crypto space is still wary of such tokens, as privacy becomes almost non-existent and counter-party risk is re-established.

Generally speaking, many crypto adopters have been drawn to coins like Bitcoin, thanks to it being free from counter-party risk in comparison to a store of value asset like gold — which is often kept under the custody of banks, which are in turn responsible to governments.

In the case of the digital pound, the token would become a new form of digital currency to be used by households and businesses, issued directly by the Bank of England.

However, the digital pound is still in the early ideation stages, with HM Treasury’s Payments and Fintech Team leading the research and development of the asset. The team is made up of roughly 20 individuals who are said to be working at the forefront of technology and innovation to ensure that UK financial services can take advantage of developments in fintech as well as the broader crypto space.

In other news, industry leaders recently met in Davos at the WEF to discuss the tokenization of global assets.

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