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UK CBDC a "Solution Looking for a Problem?"

UK CBDC a “Solution Looking for a Problem?”

(4 December 2023 – United Kingdom) The Bank of England (BoE) has been urged to consider whether a central bank digital currency (CBDC) is absolutely necessary considering significant privacy concerns and undefined risks to the banking system.

The Treasury Committee, an influential panel in the UK Parliament, insisted that the BoE “proceed with caution” and strongly consider measures to curtail risks posed by a “Britcoin” digital pound including lowering the limit on the amount of digital pounds consumers can hold. 

“It must be clearly evidenced that a retail digital pound will provide benefits to the UK economy without increasing risks or leading to unmanageable costs before any decision is taken to introduce it into our financial system” stated Treasury Committee Chair, Harriett Baldwin. 

“We must also keep a close eye on ensuring that any retail digital pound does not worsen financial exclusion for those reliant on physical cash. The digitisation of money can’t, in any way, leave those people behind. While we support the Bank of England’s plan to continue working on the design of a potential retail digital pound, I would urge them to proceed with caution and maintain a genuinely open mind as to whether one is actually needed” Baldwin added. 

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