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Thhe Bank of England released an official notice on January 21st, stating that a group of central banks will assess the possibility of launching central bank digital currencies.
The coalition of banks involved in the new cryptocurrency project will include the Bank of Canada, the Bank of England, the Bank of Japan, European Central Bank, Sveriges Risbank of Sweden, the Swiss National Bank and the Bank for International Settlements.
The group of banks will look into establishing a proper assessment of all areas for a central bank digital currency (CBDC) that will be operational within their respective countries. During the assessment phase, the group will investigate the necessary decisions for the central bank digital currency which include the use of the cryptocurrency and the design choices for the technology, its functions and the economic element behind it.
Since the digital currency will be launched on a multinational platform, the group will be taking measures to ensure its functionality across several nations with its cross-border interoperability. They will also work to incorporate sharing of knowledge on newer technologies. According to the press statement, the digital currency project will be coordinated with the institutions involved and relevant forums who will bring this technology to life. They specifically mentioned the Financial Stability Board and the Committee on Payments and Market Infrastructures (CPMI).
Coordinating Crypto Regulations
As blockchain technology is advancing and newer cryptocurrency projects are emerging, there has been an ongoing issue of regulations. However, the group of central bank plans to eliminate this problem by directly coordinating with the relevant institutions and launching a cryptocurrency that will be received well by the regulators, politicians and economists across the globe.
The statement was concluded with a few more details about the upcoming digital currency project, announcing Benoît Cœuré, Head of the BIS Innovation Hub, and Jon Cunliffe, Deputy Governor of the Bank of England and Chair of the CPMI as the co-chairs of the group of banks involved. Together they will be leading the project. The coalition will also include senior representatives of all the institutions participating in the project.
The press release did not detail any further updates regarding the CBDC and its technology for the time being. After the assessment of the central bank cryptocurrency, there will be more news about the project and a given timeframe of its release. For any further inquiries regarding the statement or additional information, the Bank of England will be releasing more press statements for the general public on its official website.