Bank of England deputy governor Sir Jon Cunliffe told the Treasury Committee creating a central bank digital currency is less about need and more about creating new possibilities.
"What we're trying to do is to see how trends in the economy, how trends in payments, how trends in society, and how trends and technology will play out," he said."We don't know, I would have thought, enough about those trends, to actually say 'yes, let's implement a very major public infrastructure'.
But work is being done now on Britcoin to avoid a situation when it's certain a digital pound is needed but the system has not been set up as the process can take up to five years."It may be that in the crypto world you can run up a payment system very quickly, but this would be a very serious thing that would have to be resilient, fraud-proof, and secure."
The focus on whether to create a Britcoin is not about whether there is a current need but more about"creating new possibilities", he said. "So this is not about here's a particular thing we think needs to be done," Sir Jon said."This is about opening a new frontier for people to improve payments and the way in which money is used in how we transact."He also laid out some new uses for digital currency: they could be to pay for very small payments, such as for a newspaper article, or automating payments such as when an online delivery does not arrive.
While cash is declining in popularity and only 20% of people identified it as their preferred payment method, it will be available to use for"as long as anybody wants it".
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