The UK continues to show its desire for a digital pound, just as its companies attempt to limit access to Bitcoin.
The Bank of England and the UK Treasury have issued a consultation document outlining their case for a retail central bank digital currency (CBDC) or “digital ledger.” The document was reviewed by the Bank-Treasury CBDC working group, which was established in April 2021.
Although the bank is still considering whether to introduce the digital book, it believes that the preparatory work is justified. If introduced, the digital pound would be a form of sterling that would be used by households and businesses for day-to-day payments. The Bank of England and the UK Treasury will engage with stakeholders across the country to seek their views on the proposed model, according to the announcement.
Simultaneously, a roadmap unveiled by Governor Andrew Bailey and Chancellor Jeremy Hunt detailed their goal of preventing a run on the banks.
According to a Telegraphic report, the two officials said consumers would be prevented from hoarding new digital books issued by the Bank of England. To avoid large and rapid outflows from traditional banks, the British will limit themselves to transferring a few thousand digital pounds to their accounts. The frictionless nature of digital currency is apparently seen as a potential risk to the stability of the traditional banking system. The previously mentioned consultation paper indicated that this limit could potentially be £10,000.
Even as these developments occur, bank CEOs in the UK are blocking customer access to cryptocurrencies due to concerns about fraud and volatility, according to reports. The leaders appeared before the special Treasury committee to discuss the matter.
Alison Rose, CEO of NatWest Group, told the committee that the bank has taken a “pretty tough line” on cryptocurrency due to the stability and volatility of the platforms and the risk of fraud. Social media and tech platforms were cited as the main source of fraud, but executives also voiced support for new regulations proposed by the UK Treasury.
All of these events point to the ability of the UK government, with the help of big business, to lock their citizens into financial obedience with strict regulations regarding the use of every private citizen’s money. The UK continues to make further progress towards containment and restriction of the bitcoin and cryptocurrency industry, while pursuing a CBDC system that would realize the worst projections of this technology.