The Bank of England, or BoE, is broadening its assessment of digital currencies, including evaluating how these assets could form the basis of a "New monetary order."
Y Haldane, the bank's chief economist and sitting member of the Monetary Policy Committee, gave a speech on Wednesday at the TheCityUK 10th Anniversary Conference.
The 19-page transcript, titled "Seizing the Opportunities from Digital Finance," delves into various topics related to digital currencies and their impact on financial stability and monetary policy.
The "Traditional model of banking would be disrupted" by a widely used digital currency, Haldane said, adding that more attention needs to be given "To the potential longer-term benefits of such a structural shift."
One such benefit is the emergence of so-called narrow banking, which would partially segregate banks' "Safe" payments-based activities from their riskier credit business.
On the monetary policy side, the central banker believes a digital currency could mitigate or possibly even negate the prevalence of negative interest rates.
"In principle, a widely-used digital currency could mitigate, if not eliminate, that technological constraint by enabling interest rates to be levied on retail monetary assets."
The European Central Bank, Bank of Japan and Bank of Switzerland all went down this route following the 2008 financial crisis.
The BoE is also exploring the various use cases of a central bank digital currency, or CBDC, but has not made any decision on the matter, according to fintech director Tom Mutton.
Central banks around the world are weighing the possibility of a CBDC, with some monetary authorities taking a more proactive approach.
BoE policymaker says digital currencies could be part of 'new monetary order'
Udgivet den Nov 19, 2020
by Cointele | Udgivet den Coinage
Coinage
Seneste nyheder
Se alt
First Mover: What's Next for Bitcoin as Wall Street Gets Vaccine Booster
Bitcoin was higher for a second day, staying in a range of between roughly $15,200 and $15,600, as news of progress in developing a coronavirus vaccine appeared to touch off a rally in U.S. stocks.
Market Wrap: Bitcoin Fails to Break $15.9K; Over 50K ETH Staked on Eth 2.0 Contract
Bitcoin gained Wednesday while Ethereum 2.0 staking has been ramping up.
Citibank Analyst Says Bitcoin Could Pass $300K by December 2021
A senior analyst at U.S.-based financial giant Citibank has penned a report drawing on similarities between the 1970s gold market and bitcoin.
Blockchain Bites: Data Unions. Hard Forks. And One Citi Analyst's Case for $300K BTC.
A Citibank managing director thinks bitcoin could hit $318,000.