Bank of England seeks CBDC advisors as Digital Pound enters design phase
Bank of England seeks CBDC advisors as Digital Pound enters design phase
The Bank of England Forms CBDC Advisory Group: A Step Towards a Digital Pound
The Bank of England (BoE) has taken significant steps towards the design and implementation of a central bank digital currency (CBDC). In collaboration with His Majesty’s Treasury, the BoE has announced the creation of a CBDC Academic Advisory Group (AAG) to provide expertise and insights during the design phase of the digital pound.
The Role of the CBDC Academic Advisory Group
The newly formed advisory group intends to draw on the knowledge and experience of experts from various fields, including monetary policy, finance, competition economics, industrial organization, behavioral science, law, innovation theory, marketing, and business. By assembling a multidisciplinary team of academics, the BoE aims to foster knowledge exchange, research collaboration, and a nuanced view on the key questions surrounding CBDCs.
The main objective of the design phase is to develop a comprehensive and conceptual architecture for the digital pound. To achieve this, the BoE plans to conduct experimentation and proofs of concept in collaboration with private sector innovators. By involving academics with diverse backgrounds, the central bank seeks to gain critical insights into the design process and build both its own and the private sector’s digital currency technology know-how.
It is important to note that the composition of the AAG will adapt to reflect the evolving issues and stages of the design phase. Further calls for interest may be made in the future as the project progresses.
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The Need for a CBDC and Public Consultation
The British government and the Bank of England recognize the potential need for a CBDC in the future. In February, a consultation on the feasibility of a digital pound was launched and concluded in June. This consultation sought public input on the advantages, risks, and challenges associated with a CBDC.
The BoE is now moving into the experimentation and design phase, which is projected to span over two years. This phase aims to build a solid foundation for the potential implementation of a digital pound, taking into account diverse perspectives and challenging prevailing wisdom on CBDCs.
Joining the CBDC Engagement Forum
As part of its commitment to understanding the practical challenges of implementing a CBDC, the Bank of England has also opened applications for its CBDC Engagement Forum. This forum will provide stakeholders with an opportunity to contribute their insights and expertise to help shape the CBDC design.
The forum’s primary focus is to gather information on use cases for offline payments and potential merchant requirements. By involving stakeholders from different sectors, the BoE aims to ensure that the CBDC design reflects the needs and expectations of its potential users.
Conclusion
The formation of the CBDC Academic Advisory Group and the CBDC Engagement Forum demonstrate the Bank of England’s commitment to exploring the possibilities and implications of a digital pound. Through collaboration with academics and stakeholders, the BoE is actively seeking to gather insights, challenge ideas, and design a CBDC architecture that is both robust and responsive to the evolving needs of the digital economy.
The journey towards a digital pound is not only a technical endeavor but also a collaborative effort involving various disciplines and perspectives. The formation of the advisory group and engagement forum highlights the holistic approach the BoE is taking in understanding and addressing the challenges and opportunities presented by a CBDC.
As the design phase progresses, the Bank of England will continue to leverage the expertise and insights of academia and stakeholders to build a strong foundation for the potential implementation of a digital pound. The outcome of this journey has the potential to reshape the financial landscape, enhance financial inclusion, and unlock new possibilities for economic growth and innovation.
