Bank of England Governor Warns Against Impact of CBDC on Fiat
- The BoE is currently looking into the feasibility of such a digital currency.
Mark Carney, the outgoing governor of the Bank of England (BoE), warned on Thursday about the risks of a central bank digital currency (CBDC) on the existing monetary system.
Reported by Reuters, the remarks were made at a time when the central bank is studying the feasibility of issuing a digital currency.
“While CBDC poses a number of opportunities, it could raise significant challenges for maintaining monetary and financial stability ... and would need to be very carefully designed if it were to be introduced,” Carney wrote in the foreword to a BoE discussion paper.
He will leave the apex position at the central bank on Friday for a new role as UN special envoy on climate action and climate finance. Andrew Bailey, the current head of the Financial Conduct Authority (FCA) Financial Conduct Authority (FCA) The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol Read this Term), will head the central bank after Carney.
Cash is from the past
The report also outlined the falling demand for cash in the UK, as both buyers and businesses are inclining towards the electronic money for transactions.
The central bank is also seeking public opinion for issuing a digital currency; however, the final decision will be in the hands of the government.
Notably, the BoE, along with five other top monetary regulators, are also due to meet next month to study the feasibility of issuing a digital currency.
The BoE earlier said that if it issues a digital currency, it would be denominated in sterling and would not replace banknotes or commercial bank deposits. It also squashed the need of a Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term for issuing a digital currency.
“If significant deposit balances are moved from commercial banks into CBDC, it could have implications for the balance sheets of commercial banks and ... the amount of credit provided by banks to the wider economy,” BoE warned.
Meanwhile, the Swedish central bank is testing a digital version of its currency - e-Krona - but it clarified that its position on issuing CBDC is still unclear.
Mark Carney, the outgoing governor of the Bank of England (BoE), warned on Thursday about the risks of a central bank digital currency (CBDC) on the existing monetary system.
Reported by Reuters, the remarks were made at a time when the central bank is studying the feasibility of issuing a digital currency.
“While CBDC poses a number of opportunities, it could raise significant challenges for maintaining monetary and financial stability ... and would need to be very carefully designed if it were to be introduced,” Carney wrote in the foreword to a BoE discussion paper.
He will leave the apex position at the central bank on Friday for a new role as UN special envoy on climate action and climate finance. Andrew Bailey, the current head of the Financial Conduct Authority (FCA) Financial Conduct Authority (FCA) The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol The Financial Conduct Authority (FCA) is the largest financial regulator for all financial markets in the United Kingdom (UK).The UK regulator is responsible for the conduct of firms authorized under the Financial Services and Markets Act 2000. Moreover, the FCA is also responsible for the regulation of behavior in retail and wholesale financial markets, supervision of the trading infrastructure that supports those markets, and the prudential regulation of firms not regulated by the PRA. Its rol Read this Term), will head the central bank after Carney.
Cash is from the past
The report also outlined the falling demand for cash in the UK, as both buyers and businesses are inclining towards the electronic money for transactions.
The central bank is also seeking public opinion for issuing a digital currency; however, the final decision will be in the hands of the government.
Notably, the BoE, along with five other top monetary regulators, are also due to meet next month to study the feasibility of issuing a digital currency.
The BoE earlier said that if it issues a digital currency, it would be denominated in sterling and would not replace banknotes or commercial bank deposits. It also squashed the need of a Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term for issuing a digital currency.
“If significant deposit balances are moved from commercial banks into CBDC, it could have implications for the balance sheets of commercial banks and ... the amount of credit provided by banks to the wider economy,” BoE warned.
Meanwhile, the Swedish central bank is testing a digital version of its currency - e-Krona - but it clarified that its position on issuing CBDC is still unclear.