Bank of England “Highly Unlikely” To Develop Retail CBDC Wallet
According to a senior manager at the Bank of England, the central bank is “highly unlikely” to develop a wallet for retail that could be used to store and spend the digital version of Pound Sterling.
United Kingdom’s central bank has been struggling to make a decision on issuing Central Bank Digital Currency (CBDC) is far from settled. The Bank of England has plans to release a consultation paper laying out its assessment of the benefits for a CBDC.
Interestingly, while the CBDC is still being discussed, the launch of an accompanying wallet seems to have been ruled out.
Katie Fortune, a senior manager at the Bank of England’s CBDC unit said:
“I think it’s safe to say it’s highly unlikely that the Bank would issue a retail wallet.”
Instead, according to Fortune it’s more likely that wallets that would support UK’s CBDC will be introduced by the private sector.
Other countries have taken a completely different approach. A pilot version of e-CNY, the mobile wallet for China’s digital yuan, went live on iOS and Android app stores in January. In El Salvador, citizens are encouraged to use state-backed wallet Chivo to manage their bitcoin, which was made legal tender in the country in September 2021.
Technical questions
Apart from the wallet, several other technical questions relating to the Bank of England’s CBDC are still unanswered.
According to Fortune, it’s still undecided, if any CBDC issued by the central bank would be built on blockchain technology. She said:
“That’s still a really open question for us. It’s not taken as a given that it is built on a blockchain, it’s not taken that it’s not.”
Fortune added that the central bank has been taken into consideration a wide range of views through its CBDC forums, whose members include representatives from banks, fintech firms and academics.
According to Fortune, should the Bank of England move forward with a CBDC after publishing its consultation paper later this year, it would then enter a development phase that would involve “working up some prototypes.”
Timing wise, she does not see a CBDC launching in the UK until 2025 at the earliest.
