By Will McCurdy
19/05/2021
Some experts believe a fundamentally different approach to the pound sterling could help the UK stay internationally competitive. Will McCurdy explores the potential effect of a central bank digital currency (CBDC) on the UK financial services industry, if it could help the City of London stay competitive, and what challenges its introduction might hold.
In 2020, though almost everyone could tell you what a Bitcoin is, and in some circles almost anyone could tell you what a blockchain is, far less could tell you what a central bank digital currency (CBDC) is.
What is a CBDC? Though anyone can hold cash, only banks can hold digital pound sterling. A digital pound would allow citizens and businesses to transfer money to each other without the use of a third-party bank as an intermediary. Which might be a worrying proposition for the UK, a country where the financial services sector is worth £132 billion – the ninth largest in the developed world as a