BOE Aprises Risk For UK Due To Digital Pound

Vandana  |  Mar 13, 2020

According to Mark Carney, governor of the Bank of England (BOE), if the digital currency by the central bank will be launched in U.K. then there would be a risk to the overall monetary governance.

On Thursday, in a short introduction of BOE’s working paper, Mark Carney wrote,

“while CBDC (central bank digital currency) poses a number of opportunities, it could raise significant challenges for maintaining monetary and financial stability."

The governor further said that there is a need to be extra careful while designing the Digital Pound if it is to be launched by the central bank because it could lead to potential risks to financial and monetary stability. He also said that it is not certain whether the central bank will ever introduce its own digital currency.

Carney said Digital Currency could replace U.S. Dollar

Earlier it has been reported that Carney has praised cryptocurrency for central banks as he has given several pro-cryptocurrency statements. While talking to some British lawmakers, he has said that the changes in the price of bitcoin are remarkable and could be compared to equity risks.

He has said that there will not be any kind of threat to the financial stability due to the rising value of bitcoin. Carney also said that one day, the U.S. dollar could be replaced by the digital currency as the global reserve currency. 

Andrew Bailey to succeed Carney as governor of BOE 

This comment by the governor would be among his last ones as the governor of BOE. Carney would be taking over as an envoy on climate action and finance by the United Nations. He will leave his position of governor at Central Bank on the same day.

The position of Carney would be taken over by Andrew Bailey who is currently servicing as the head of the Financial Conduct Authority.

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