Bank of England Governor Andrew Bailey spoke at a conference in Kyiv, clarifying the central bank's stance on the digital pound and expressing doubts about its need.
Bank of England's Position on the Digital Pound
Andrew Bailey stated that he is not yet convinced of the need to create new forms of money, such as a Central Bank Digital Currency (CBDC) for everyday consumers. He mentioned that the bank is making progress on wholesale digital currency but is less enthusiastic about a retail version for households.
Comparison with Other Countries
Unlike countries that are aggressively advancing with digital currencies, such as China and the European Union, the UK is still in the design phase. Bailey emphasized the need to assess the necessity of a digital pound based on actual demand for such a currency.
Risks of Cryptocurrencies and Financial System Structure
Bailey also raised concerns about the risks associated with cryptocurrencies, referring to them as a "risky asset class." He cautioned investors to proceed with caution, as they could lose all their money. Furthermore, he questioned whether the post-2008 financial regulations may have been overly stringent, creating risks in less-regulated segments of the market.
Andrew Bailey's remarks suggest that the introduction of a digital pound will not be taken lightly and requires a thorough assessment of market needs and expectations.
