The governor of the Bank of England (BoE), Andrew Bailey, raised concern about the necessity for a digital pound immediately after eurozone finance ministers agreed to continue work on a digital euro.
The governor of the Bank of England has questioned the necessity for a wholesale central bank digital currency (CBDC), claiming that a “wholesale central bank money settlement system with a considerable improvement” currently exists.
Furthermore, Bailey said that there are no intentions to eliminate currency from retail usage. The governor of the Bank of England believes that retail payments do not need to alter at this time.
Bailey’s remarks come in the wake of fresh CBDC developments in the eurozone and recent comments from a former Bank of England advisor on the costs and hazards of establishing a CBDC.
On Jan. 16, finance ministers from the eurozone nations released a statement encouraging further work on a possible digital euro being investigated by the European Central Bank. The Eurogroup acknowledged that the adoption of a CBDC requires more political debate. Furthermore, the committee underlined the challenges it was witnessing, such as environmental consequences, privacy, financial stability, and other concerns.
On the same day, former Bank of England advisor Tony Yates argued in a Financial Times editorial post that the costs and risks connected with CBDC construction are not worth it. Yates also questioned the reasons underlying the development of CBDCs, calling them “suspect.”
Meanwhile, Iran and Russia are discussing the development of a new stablecoin backed by gold. According to the Russian news source Vedomosti, Iran is working with Russia to develop a “token of the Persian Gulf area” to facilitate cross-border transactions.
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