News

Bank of England Governor open to the Idea of launching a central bank digital currency.

The Governor of the Bank of England (BOE) Mark Carney said at the Anniversary conference of a central bank of Sweden Riksbank, that he was open-minded about the prospect of a Central Bank Digital Currency (CBDC), Bloomberg reports May 25.

While he reportedly is not opposed to the idea of implementing a CBDC, Carney stressed that he was open-minded about the prospect of a central-bank-issued digital currency, but added such a thing was not imminent, and that cryptocurrencies currently don’t perform the role of money.

At the 350th anniversary of Riksbank on May 25, Carney stressed that the “past, present, and future” of central banks have and do depend on maintaining public trust in the financial system. Carney said that, in order to keep money safe, the BOE has overhauled the financial system since the crisis, making it more resilient to shocks such as cliff-edge Brexit.

In February of this year, Carney sharply criticized cryptocurrency at an event at London’s Regent’s University, saying that,

It [cryptocurrency] has pretty much failed thus far on… the traditional aspects of money. It is not a store of value because it is all over the map. Nobody uses it as a medium of exchange.

Earlier this month, the Bank of England has issued a working paper describing the possible financial risks and insecurity issues of using a CBDC. The report concluded that there was no reason to believe that adopting a CBDC would negatively impact private credit or total liquidity provision to the economy.

Other central banks in Europe have also considered adopting a CBDC. Earlier this month, The Norwegian central bank Norges Bank issued a working paper in which they consider developing a government-backed digital currency as a supplement to cash to “ensure confidence in money and the monetary system.” The aforementioned Riksbank is also considering an e-krona as the use of banknotes and coins declines in Sweden.

Share now