Bank of England joins digital currency meeting in August
On Wednesday, August 19, 2020, the Official Monetary and Financial Institutions Forum (OMFIF) will host representatives from several major financial situations including the Bank of England, the Swiss National Bank, Magyar Nemzeti Bank and ING Group alongside enterprise-focused blockchain platform Cypherium, in a virtual roundtable to discuss central bank digital currencies (CBDCs) and their infrastructural designs.
Simon Scorer, senior fintech specialist for the Bank of England (BoE) joins the other leading central bank delegates to discuss CDBC infrastructure and interoperability, as we edge nearer to a CBDC being introduced into the UK.
The BoE’s interest in CBDCs piqued in 2020. In January, it led a collective of central banks in evaluating the economic perks of CBDCs. In March, they published a discussion paper and issued a call for comments on the conceptual “platform” model for a CBDC. And last month, the Governor of the BoE, Andrew Bailey, hinted that a digital currency could be on Britain’s agenda in the next few years.
“We are looking at the question of, should we create a Bank of England digital currency,” said Bailey during a webinar event in July. “We’ll go on looking at it, as it does have huge implications on the nature of payments and society.”
For the BoE, a CBDC could both create new opportunities within payments, global trade, and financial stability and aid post-COVID-19 economic recovery, tackling challenges such as cash shortages, and the impetus for digital transactions.
In the past few years, the global progress on CBDCs has been monumental. With pressure mounting from private sector initiates such as Facebook’s Libra and concerns it could impact monetary control, central authorities throughout the world launched their own CBDC ventures.
Now, with an estimated 80% of central banks all over the world investigating the potential of CBDCs, attention has turned to which infrastructure should underline them.
The OMFIF roundtable will observe a meshing of minds discussing the pros and cons of surfacing tech, such as blockchain and distributed ledger technology (DLT). The talks will probe design opportunities ranging from DLT, and its ability to linchpin existing technology and vendors, to the application of blockchain-based smart contracts and how they can enable interoperability across an entire ecosystem of CBDCs and networks.
Joining the virtual roundtable discussion is Simon Scorer, senior fintech specialist for the Bank of England; Thomas Moser, alternate member of the governing board at the Swiss National Bank; Sky Guo, CEO of enterprise-focused blockchain platform Cypherium; Anko Szombati, chief digital officer at Magyar Nemzeti bank; and Cees van Wijk, IT specialist in the global ING Blockchain-team.
“It’s a privilege to be speaking alongside some of the world’s most respected financial institutions,” says Cypherium CEO Sky Guo and OMFIF founding member. “The importance of discourse when it comes to building the financial future shouldn’t be undermined. With CBDCs still in their initial phase of conception, now is the time to debate the advantages and disadvantages of infrastructural ideas, especially related to how these instruments will interact and operate with each other.”
Each delegate will present findings from progress on their institution’s CBDC proposals, exploring the potential of technical infrastructure to tackle such issues as interoperability and scalability.
Interoperability stands as a particularly pressing issue when it comes to CBDC infrastructure. With so many sovereign CBDCs in the works, compatibility issues are inevitable. Cypherium has developed a solution to facilitate interoperability between CBDCs, enabling distinct designs to interact with each other regardless of their foundation.