While interest in central bank digital currencies (CBDCs) continues to soar around the world, a group of innovation and regulatory experts in the U.K. are taking a proactive step to promote its launch in the country.
Big-name brands including Accenture, Billon Group, Ava Labs, CGI Group, Electroneum and Ripple are some of the companies that have joined forces to launch the Digital Pound Foundation (DPF), a nonprofit focused on the creation and implementation of a digital pound in the United Kingdom.
Chaired by Barclays senior executive Jeremy Wilson, the recently launched forum aims to push forward the implementation of a proposed CBDC in the U.K., conducting research and advocacy while increasing stakeholder engagement for the rollout.
Commenting on the DPF launch, Wilson said the world has become a “global laboratory,” and that digital currencies must adapt to how technology is transforming human interaction. “The social ramifications of this shift will affect everyone. The Digital Pound Foundation seeks to support the U.K. in bringing that about for the benefit of all,” he added.
The DPF believes that both the U.K. economy and the British society at large will benefit from a virtual form of the pound, and the group has committed to bringing public and private sectors together to work on developing a new digital money landscape.
Richard Ells, CEO of digital smartphone cryptocurrency Electroneum, said his decision to join the foundation stems from a desire to ensure that the digital pound and other similar digital currencies can help reduce financial exclusion.
“The reason for our involvement is to see financial inclusion take place through the implementation of the digital pound in the U.K. and worldwide,” Ells said. “I want us to do our part to ensure that digital currencies enable people globally to pull themselves out of poverty.”
Read more: Ripple Joins Nonprofit Focused on Creating Digital Pound
Blockchain solutions provider Ripple is also supporting the nonprofit’s effort as part of its collaboration with central banks worldwide on technical and policy issues related to CBDCs, according to a PYMNTS report.
“We are excited to support the design and implementation of a digital pound in partnership with the Digital Pound Foundation,” said Susan Friedman, Ripple’s head of policy. “The foundation will help advance the U.K.’s goal to build a more inclusive and sustainable financial system.”
BoE’s Active Search for CBDC Information
The fact that the DPF is pushing for the creation of a digital pound may imply that not enough is being done at the upper echelons of government to get it off the ground.
But in April, the Bank of England (BoE) and the Treasury announced the launch of a joint task force to explore the creation of a U.K. CBDC. That was followed by BoE Governor Andrew Bailey expressing optimism about the project at a Bank for International Settlements (BIS) event in London in June.
“I’m very encouraged by progress on that [CBDC] front, and the fact that we are getting to grips with this critical innovation,” he said. “If this comes to pass, it will be one of the most fundamental innovations in the history of central banking — it will move us into a new era.”
Related news: BoE Enlists Payments, FinTech Firms to Study CBDC
According to a report from The Block last month, the central bank has also staffed two third-party working groups — the Engagement Forum and the Technology Forum — to provide insights on policies and functions of a CBDC, while helping the bank assess the ins and outs of operating a CBDC.
Members of the two groups include a host of big names from across the U.K.’s payments and FinTech sectors, along with companies in the crypto space like Monzo, Starling, PayPal, Visa and Mastercard.
CBDCs Must Support and Do No Harm
While the DPF pushes for the launch of a U.K. CBDC, G7 finance leaders, including the U.K., have said that CBDCs must “support and do no harm” without infringing on a central bank’s ability to fulfill its mandate on monetary and financial stability.
According to a Reuters report, the leaders of the world’s advanced economies issued a statement after a meeting on Wednesday (Oct. 13), stating that CBDCs would be used alongside cash and not replace it, while acting as a liquid and anchor for the payments system.
“Any central bank digital currency (CBDC) should be grounded in long-standing public commitments to transparency, rule of law and sound economic governance,” the G7 finance leaders said in a statement.
And while acknowledging the potential of CBDCs to boost cross-border payments, the G7 countries said they have a “shared responsibility to minimize harmful spillovers to the international monetary and financial system.”
See also: CBDCs Can Cut Cross-Border Transaction Time
Given how interest in the virtual currency has soared recently, especially in the wake of the pandemic, it comes as no surprise that the G7 central banks are eager to set common standards for CBDC issuance.
A 2021 poll by central bank umbrella group BIS revealed that close to 90% of the central banks surveyed are investigating the possibility of launching a CBDC, while another recent survey found that central banks representing a fifth of the world’s population are likely to issue their own virtual currencies in the next three years.
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