The Bank of England’s head of fintech and CBDC program, Tom Mutton, has revealed that the central bank digital currency (CBDC) will prioritize privacy for users. Mutton stated that the digital pound would be pseudonymous, meaning that no personal data would be collected by the government or the Bank of England. He also mentioned that the infrastructure would be provided by the bank, while private players would be responsible for innovation.
In addition, Mutton discussed how the underpinning technology for the UK CBDC could potentially use a different ledger than the popular blockchain technology. The bank is currently considering multiple ledger technologies and aims to be compatible with distributed-ledger business models in the private sector. However, Mutton stated that they were not convinced that distributed ledgers offered more efficiency over conventional ledgers.
The development of the digital pound, also known as Britcoin, began when the Bank of England and the UK Treasury established a joint task force to research a UK CBDC in April 2021. The bank issued a consultancy paper outlining the design of the digital pound in February 2023, and stakeholders and technology experts can provide feedback until June 30.
Overall
The Bank of England’s CBDC program emphasizes privacy for users and is exploring various ledger technologies beyond blockchain.