Bank of England Considers Suspending Digital Pound Issuance Plan
The Bank of England (BoE) is considering the possibility of temporarily halting the implementation of the digital pound issuance plan. This is the central bank-issued digital currency (CBDC) for the public, which was previously seen by BoE as an important part of the strategy to modernize the UK financial system.
According to international media reports, this decision stems from increasing doubts within BoE about the effectiveness and necessity of the CBDC project in the current context. Close sources indicate that BoE has held multiple private discussions with banking representatives and urged the private sector to accelerate payment technology innovation. The goal of this effort is to achieve improvements equivalent to what CBDC promises, without issuing a national digital currency.
BoE maintains its stance of continuing research and preparation for potential CBDC issuance if future conditions change or clear market demands emerge. However, if the private sector continues to provide efficient electronic payment methods, and internal experts determine that the benefits of the digital pound are no longer significant enough to justify the costs and risks, the plan may be completely suspended.
The digital pound project was once expected to play a crucial role in maintaining the pound's position in the digital economy, ensuring financial stability in the digital era, and enhancing retail payment system efficiency. However, during research, many issues have been raised regarding privacy, impact on traditional banking systems, and the potential for CBDC to alter financial institutions' capital mobilization models.
BoE's move occurs in a context where many countries are also reassessing the progress and feasibility of CBDC projects. Some central banks have chosen a more cautious approach, while fintech companies and commercial banks continue to develop modern digital payment solutions such as electronic wallets, QR code payments, contactless transactions, and blockchain applications.
