Britain is considering introducing a digital pound

A digital pound would be issued by the Bank of England, unlike volatile corporate-made cryptocurrencies such as bitcoin and ether, and could be used by consumers and businesses for day-to-day payments, both in-store and online. The digital currency would be introduced in the second half of this decade at the earliest and should not replace cash, but complement it.

“Cash will continue to exist,” Treasury Secretary Jeremy Hunt said. “A digital pound issued and secured by the Bank of England could be a new payment method that is trusted, accessible and easy to use.” It is therefore necessary to explore what is possible while protecting financial stability.

Pure means of payment without interest

A digital pound would be used through a smartphone’s wallet function or a smart card, it said. It serves purely as a means of payment, no interest is paid.

Similar plans also exist in the Eurozone. The currency watchdogs there have been considering the possible introduction of a digital version of the European common currency for some time now. In mid-July 2021, the European Central Bank (ECB) decided to take the preparatory work to the next level: a two-year research phase will now focus on technology and data protection, for example. An introduction is expected in 2026 at the earliest. Other central banks around the world are also dealing with digital central bank money. (sda/dpa)