Bank of England (BoE) will be attending a key meeting tomorrow, alongside other banks, to discuss Central Bank Digital Currencies (CBDC) and the potential they have.
The meeting will be carried out in a virtual roundtable format, and will be hosted by the Official Monetary and Financial Institutions Forum (OMFIF) on 19 August. Considered to be a key, historic meeting, it will be attended by officials from Bank of England, Swiss National Bank, ING Nederland and Hungarian National Bank. Sky Guo, the CEO of blockchain platform Cypherium, will also participate in the gathering in order to explain the benefits of the technology.
The OMFIF stated on its website:
“Following technology breakthroughs by private cryptocurrencies, central banks are considering the use of distributed ledger technology and blockchain to develop their own digital currency. Blockchain technology offers the benefits of operational resilience, transparency and tokenisation, among others. The extent of scalability, the balance between privacy and decentralisation, and interoperability opportunities warrant further exploration.”
One of the goals of this meeting will be to explore the impact blockchain technology can have on various models for CBDCs, for example the use of smart contracts to enable interoperability across blockchain networks “within and across borders”. The meeting will also provide an opportunity for the banks to share the findings from their internal CBDC research.
This is not the first time that the BoE has shown interest in the potential of CBDCs. Back in January, the central bank joined a working group with five other banks to explore the potential use cases for CBDCs. Later, in March, the BoE also released an in-depth discussion paper analyzing the potential of CBDC to support the bank’s task of managing monetary and financial stability.
While these banks are still in the discussion phase, others are already conducting tests on their CBDCs. A perfect example is Bank of Thailand, which has already made financial transactions with a number of businesses using its digital baht, and is now looking to expand its use to even more businesses in the country.
China, on the other hand, is already conducting tests of its CBDC in the cities of Shenzhen, Suzhou, Xiongan, Chengdu and the future site of the winter Olympics. Recent reports also claim that the country’s Commerce Ministry was considering expanding the trials to include the provinces of Beijing, Tainjin, and Hebei.