BOE Governor Throws Shade on Digital Pound for Consumers

Andrew Bailey Questions the Need for Everyday Use While Pushing Forward with Wholesale Version

Hold onto your hats, crypto fans! The Governor of the Bank of England just threw some serious doubt on the idea of a digital pound for everyday consumers. While the central bank is charging ahead with a wholesale version for financial institutions, Andrew Bailey isn't convinced we need a retail version for the masses.

Speaking at a conference in Kyiv, Ukraine, Bailey admitted that Central Bank Digital Currencies (CBDCs) could bring some cool perks like smart contracts and better fraud protection. But he's not buying that we need to launch a consumer digital currency to make those dreams a reality.

He did say that the BOE is "well on the way" to developing a wholesale CBDC for transactions between financial bigwigs. But when it comes to the retail version? He's just not feeling it.

"I start with the presumption that there should be benefit here – it seems like a failure of imagination if we think otherwise," Bailey said. "That said, I remain to be convinced that we need to create new forms of money – such as Central Bank Retail Digital Currency – to achieve this."

The BOE's digital pound project has been under the microscope, with over 50,000 people weighing in during a 2023 consultation. Deputy Governor Jon Cunliffe spilled the beans that many folks are worried about privacy, the future of cold, hard cash, and fears that the central bank could pull the strings on how the currency is used.

Even the House of Lords Economic Affairs Committee is throwing shade, calling out the "significant risks and challenges" in a 2023 report. They're not convinced the benefits outweigh the potential pitfalls.

Right now, the BOE is still in the design phase of its retail CBDC, lagging behind other countries in the race to launch one. They're teaming up with the UK Treasury but haven't decided if they'll actually pull the trigger on a digital pound for the public.