The Bank of England is reportedly exploring the possibility of developing and issuing its own digital currency, according to recent reports in The Telegraph.
The publication said the financial institution (FI) could issue the currency as early as this year if plans are approved. The Bank of England has created a research unit designed to investigate the development of a digital currency. Reports said the bank would aim to allow individuals to keep their money in the form of a cryptocurrency stored with the Bank of England itself.
Such a plan could cause massive disruption to the retail banking sector, negating the need for a retail bank account and accelerating the ability to facilitate high-value transactions, like the purchase of a house.
The Telegraph said the research unit was created in February 2015.
The news represents a significant signal of approval — or, at least, openness — to cryptocurrencies by a major central bank. Despite growing interest in digital currencies, however, the Bank of England recently highlighted the ongoing use of cash in the nation.
Last October, Bank of England Chief Cashier Victoria Cleland spoke at the Future of Cash Conference in Austria and emphasized that “cash is not in decline.”
“Very notable in the U.K. is the rise in the use of contactless cards, which tripled in 2016, accounting for 7 percent of payments,” said Cleland. “The shift in consumer preferences is also evident in online spending, where average weekly online shopping in the U.K. was £1.1 billion in August 2017, an increase of 16 percent compared with August 2016. Such developments have led many commentators to predict the demise of cash.”