The BoE presses ahead with digital pound testing despite ongoing public concerns and a track record of failed CBDCs.
The global landscape of central bank digital currencies (CBDCs) is rapidly gaining momentum, with 66 countries currently piloting or developing projects, according to the Atlantic Council. Despite widespread public concerns and notably low adoption rates in various pilot programs, the surge in CBDC initiatives continues unabated.
Against this backdrop, the Bank of England (BoE) recently updated the digital pound, outlining the projectâs next steps.
BoE Ready to Advance Digital Pound
In an update on its CBDC project, the BoE announced it is moving forward with the digital pound by entering the design phase. This stage will involve assessing the technological and policy requirements to bring the CBDC to life. The BoE estimated that the evaluation process could take up to three years to complete.
During the design phase, the central bank plans to conduct real-world testing of the digital pound to gain insights into how the CBDC would function in everyday scenarios. The findings from this will determine whether the BoE advances to the projectâs build phase.
The BoE emphasized that implementing a digital pound has yet to be decided. Before any potential rollout, the project would require Parliamentary approval and undergo another round of public consultation.Â
According to the central bank, the earliest possible launch would be in the âsecond half of this decade.â
The BoE included a Q&A section in its update to address common concerns. The central bank assured that neither it nor the government would be able to surveil transactions. It stated that user privacy would also be safeguarded by existing data protection laws.Â
Additionally, the BoE stressed that there would be no mechanism for the central bank or government to program or restrict digital pounds, aiming to allay fears about potential financial control.
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