The UK Treasury and the Bank of England have highlighted certain criteria for a possible digital currency.

The United Kingdom government said it is cautiously advancing the design phase of its central bank digital currency (CBDC), according to a response to the Treasury Committee published on Jan. 25.

The government stressed that no final decision has been reached on the launch of a digital pound, adding that its officials are still exploring the feasibility and design of a CBDC.

The regulator further stated that it is in the process of developing standards and formulating a comprehensive assessment framework to determine the feasibility of launching a national digital asset.

The UK Treasury and the Bank of England said in a statement:

“The design phase will deepen our understanding of how to design a digital pound to maximise opportunities while minimising risks, and will aim to build a robust evidence base to inform a decision later this decade on whether to proceed with the rollout of a digital pound.”

Treasury Committee chair Harriet Baldwin described the digital pound as a “major technical project” that should only be undertaken if the benefits outweigh the risks.

Private issues

The Bank of England and the Treasury also addressed privacy issues related to currency.

According to the joint statement, the government will take specific legal measures to ensure user privacy. In addition, law enforcement agencies' access to user personal information will be strictly limited and operate on a fair and legal basis.

“HM Treasury and the Bank agree that strong privacy protections are essential if a digital pound is to be introduced,” they wrote.

The response also made clear that if a decision was made to launch a retail CBDC, neither the Bank of England nor HM Treasury would have access to user data.

“One of the main risks is the potential misuse of data, which is why we recommend that privacy protections be included in primary legislation in the event of the introduction of a digital pound,” the committee chair said.

Protecting access to cash

Furthermore, both government agencies stressed that they would be committed to safeguarding cash access if a CBDC was issued.

They stated:

"A digital pound would complement, not replace, cash. The government and the Bank have a clear commitment to providing access to cash for those who want to use it." #英国 #CBDC