The UK Prime Minister has put CBDC on the Treasury Department’s financial reform list
Rishi Sunak, the UK’s Chancellor of the Exchequer, has added cryptocurrencies and stablecoins to the list of financial reforms the government plans to implement over the next few years.
Speaking to lawmakers at the Mayor’s residence in London on Thursday, the Prime Minister said the UK government would implement recommendations to help establish the country as a hub for innovation and fintech business. Although Sunak said the UK would protect citizens’ access to cash, he added that authorities would monitor financial and technology updates and work on their own digital asset reforms.
Over the next few years we will implement a number of major reforms in the financial services sector.
Strengthen our competitive advantage in the area of financial services, pass on our community and work internationally to set higher global standards. https://t.co/flDTRBpxG3 pic.twitter.com/bN8mimU2Qw
– Rishi Sunak (@RishiSunak) July 1, 2021
Based on an independent assessment of the UK fintech sector conducted by businessman Ron Kalifa, Sunak said officials are being advised on breakthrough reforms “in support of a safe introduction to Currency, or CBDC.” The report, released in February, proposed changes to the country’s regulatory framework for new technologies, promoting education in the fintech sector, promoting existing fintech companies in the UK and much more.
The UK has been researching the CBDC for some time. The country took a giant step last year when both the Bank of England and the UK Treasury announced that they were investigating “whether central banks could issue digital currencies”. Following the release of the Kalifa review in February, the authorities formed a central bank digital currency task force to investigate preliminary issues related to the design of the digital currency and to establish and operate a CBDC in the UK.
Connected: UK authorities are focusing on stablecoin regulations to prevent monopolies
While Sunak said in November that Brexit will give the UK an opportunity to reform its financial services sector, some have raised concerns about the impact of CBDC implementation on the market. The regulatory impact of stablecoins, concerns about currency sovereignty and consumer protection, and cash access for individuals are on trial as the UK investigates further shifts to digital fiat currency.
“While I believe in the power of new technologies, we also need to manage their impact on our economy and society.