What Do We Want! Digital Currency!

Dateline: Berlin, 30th March 2023Kicking off MPE 2023 with my co-host Anna Maj.I was at the Merchant Payments Ecosystem conference in Berlin this week, and there was a lot of talk about central bank digital currency (CBDC), much of it from me. But around the world, it is a focus of plenty of other people’s attention. According to the Atlantic Council, 10 countries have fully launched a digital currency and China is on course to expand from its pilot CBDC in 2023. The Digital Monetary Institute “Future of Payments” report from last year said that two-thirds of central banks surveyed expect to issue a CBDC within 10 years.ShareBritcoin is ComingBack home, the Bank of England has released a consultation document, together with an associated technology working paper, on Central Bank Digital Currency (CBDC). Sir Jon Cunliffe, the Deputy Governor for Financial Stability, gave an interesting speech on the need for such a digital currency. How exactly such a retail CBDC will work is yet to be determined but Sir Jon talked about a public-private partnership in which the Bank would provide the digital pound and the central infrastructure and the private sector (banks or “approved non-bank firms”) would provide the wallets and associated payment services, an instance of the “two tier” approach favoured by central banks worldwide.Background reading: The Currency Cold War.The Bank aside, there are many, many stakeholders who will need to form a view and provide input to the consultation process. Andrew Griffith, the Economic Secretary to the…What Do We Want! Digital Currency!