Central bankers split on CBDC future
The debate over the value of CBDCs continues to simmer, with central bankers on either side of the pond weighing in with very different opinions.
In a speech this week, Bank of England Deputy Governor Jon Cunliffe gave one of the strongest hints yet that the UK is on its way towards some form of Britcoin.
“We may not be there yet, but it looks probable in this country that if we want to retain public money capable of general use, and available to all citizens, the state will need to issue, public digital money,” Cunliffe told his audience.
In contrast, Boston Federal Reserve president Eric Rosengren has offered up his own, less enthusiastic, views on the subject of a digital dollar.
“It is important to understand what problems a central bank digital currency is being designed to solve, and whether other technologies could more cheaply or efficiently address those problems,” said Rosengren at a virtual event this week.
Rosengren highlighted familiar potential upsides to CBDCs, including more financial inclusion and cheaper cross-border payments, but also stressed the risks to financial stability.
Despite the misgivings, Rosengren’s Boston Fed is working with the Massachusetts Institute of Technology to develop a “hypothetical” digital currency platform.
Meanwhile in the UK, the Bank of England and UK Treasury recently launched a fintech taskforce to coordinate exploratory work on a potential CBDC.