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And the Prime Minister has welcomed the report, by the Government’s Taskforce on Innovation, Growth and Regulatory Reform (TIGGR), chaired by former Tory leader Sir Iain Duncan Smith MP, suggesting it offered a roadmap for “realising the promises of Brexit”. Meanwhile, Professor Daniel Hudson, chairman of the City United Project (CUP) think tank, one of the organisations invited by Sir Iain to give evidence to him and his colleagues, including fellow MPs Theresa Villiers and George Freeman, hailed the report as “a prospectus for global Britain’s future prosperity and security”.
As part of the evidence submitted, attention was paid to the CUP’s April report on the Aurora proposals on the need for the immediate development of a Central Bank Digital Currency (CBDC), or ‘E-Pound’, which included a total of 24 recommendations related to the City and the UK’s financial services industry.
The TIGGR report said: “There are various models for retail CBDCs that the UK could look to adopt, but in our view, the UK should consider a hybrid model like the one proposed in the CityUnited Project’s proposal whereby the CBDC is a claim on the central bank, with intermediaries onboard to handle the retail payments.
“The involvement of payment services providers would allow for innovation and speed, which would allow the UK to be the first to introduce such a hybrid retail model.
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Iain Duncan Smith MP, the former Tory leader, chaired the taskforce
“Interoperability between the CBDC and other forms of money is essential if we hope to encourage widespread consumer adoption.”
In a letter to the Taskforce, Mr Johnson said: “I asked you to re-imagine, quickly and creatively, the UK’s approach to regulation and make best use of our recently rediscovered freedoms.
“You have more than delivered on that charge, responding with substantive plans that will really put a TIGRR in the tank of British business.”
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I have asked Lord Frost to drive this critical work forward
He added: “I want to reassure you that far from being the end of the process, your work on TIGRR is only the beginning of our drive to realise the promises of Brexit.
“I have asked Lord Frost to drive this critical work forward, creating a new Brexit Opportunities Unit at the heart of government to engage across society, academia, and industry, generating new ideas and acting as a counterweight to Whitehall orthodoxy.”
Mr Johnson said: “Your report shows what a fully sovereign United Kingdom can achieve given sufficient ambition and vision on the part of its government.
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Lord David Frost, the UK’s Brexit Minister
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“I look forward to drawing on your work in the months and years ahead as we build back better than ever before.”
Prof Hudson said: Hodson, said: “The City United Project welcomes the far-reaching and visionary TIGGR report, which sets out a compelling regulatory framework for post-Brexit prosperity.
“Whilst its findings have been endorsed by the Government, the challenge will now be to ensure their speedy implementation and thus maximise their benefits.
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“CUP submitted 24 recommendations. Its leading call was for a wholesale-based Sterling Central Bank Digital Currency and this was specifically mentioned and backed by the Taskforce, clearly supporting the massive geopolitical, economic, regulatory and social benefits of the earliest possible rollout.”
All of CUP’s recommendations were embraced by the overriding regulatory principles set out by the Taskforce, especially the challenge to Britain to take the lead in establishing Common Law based international regulatory standards, Prof Hudson said.
He added: “The CUP agrees that such top priority initiative should build on the opportunities provided by its world-beating fintech industry and be outcomes-based and principles-based, as well as being sensitive to innovation, competition and proportionality.
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“In short, the TIGRR report represents a prospectus for global Britain’s future prosperity and security. But a core theme running throughout the document is the need for speed. Everything else is in place. Now the Government must act swiftly and decisively.”
A Central Bank Digital Currency would make electronic money, issued by the Bank of England, available to all households and businesses, without replacing cash and bank deposits.
China is already forging ahead with plans for a CBDC by the time of next year’s Beijing Winter Olympics – and in April Mr Sunak suggested Britain would do likewise.
A report published in the Financial Times in May suggested such a move could expand the UK’s economy by as much as £90billion.