Bank of England Governor: Will continue to provide cash and is establishing a retail CBDC for innovation
ChainCatcher news, according to Bloomberg, as concerns grow that the Bank of England's digital currency (CBDC) Britcoin will replace cash, Bank of England (BOE) Governor Andrew Bailey stated, "The evidence shows that people do indeed want cash, so we will continue to provide it."Bailey's remarks reiterated what senior Bank of England official Sarah Breeden said last year during a Treasury Committee inquiry. She stated:"We will ensure that cash is available as long as there is demand. We will ensure that the cash infrastructure in the financial system exists as long as there is demand—cash and digital currency are both options." Since the idea of CBDC was first proposed a few years ago, lawmakers and citizens have been divided over its pros and cons. Supporters of Britcoin argue that it has the potential to reduce costs and risks. However, opponents worry that it could empower the government to monitor people's spending and replace cash.The Bank of England began designing a digital version of the pound in January this year. However, the Bank of England has not yet decided whether to actually launch it. Bailey stated that he supports the issuance of wholesale CBDC but is cautious about issuing retail CBDC. He added that in terms of retail CBDC, "it's hard to see central bank money playing a anchoring role." However, wholesale CBDC could play a "special role" in "wholesale high-value payments and settlement of payment systems for central bank money."Bailey further added that the Bank of England is establishing retail CBDC for innovation purposes. He believes that CBDC innovation should be open to the private sector, which will ensure that commercial banks modernize their digital payment systems. He also pointed out that banks lack the incentive to improve efficiency in certain areas, such as cross-border payments, which "stifles innovation." Therefore, in the "cross-border payments space, modernization progress remains slow," Bailey stated, and better digital systems are needed, "there is no sufficient reason for arbitrary decision-making on this issue."
