BoE CBDC chief Digital pound will prioritize privacy with pseudonymity.
The Bank of England (BoE) has been making significant progress in developing its central bank digital currency (CBDC) program. Tom Mutton, Director of Fintech at the BoE, recently discussed the privacy aspect of the CBDC and why the central bank may consider other options beyond blockchain as the underlying technology.
In a recent interview, Mutton stated that during a meeting of technologists hosted by the BoE to discuss the design of the digital pound, there was a clear disagreement on which ledger should be used for the CBDC. As a result, the bank plans to trial multiple ledger technologies, including blockchain.
The development plans for a digital pound, dubbed Britcoin, were first proposed in April 2021 when the United Kingdom’s Treasury Department and the BoE established a joint task force to research a UK CBDC. In February 2023, the bank issued a consultancy paper outlining the design of the digital pound.
Related: Digital pound could co-exist with private stablecoins
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Currently, the BoE and the UK Treasury are seeking feedback from stakeholders and technology experts on the proposed design of the CBDC. The feedback period is open until June 30.
Mutton also discussed the privacy aspect of the CBDC, stating that it would focus on providing privacy to users and would not collect personal data. He said the bank’s focus would be on providing the infrastructure, while private players would be responsible for innovation.
“There will be no data shared with the Bank of England, we will know what transactions have happened but we will have no data on the individual who did it. While the wallet provider would have the user data but won’t have access to their transaction data.”
Mutton claimed that the BoE or the government would not have access to any user data, and even wallet providers with limited access to that data would require user consent regarding what data they can store. The BoE has previously stated that the digital pound could co-exist with private stablecoins and is focused on retail.
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