The BoE needs to consider its position on the technology to ensure the U.K. has “a broad range of payments that it can use with confidence,” John said, as reported by the Daily Telegraph on Saturday. “It is absolutely right that central banks think about whether a public sector or private sector would be best to provide a digital currency going forward.”
The Bank of England’s (BoE) chief cashier, Sarah John, said it is “crucial” central banks research digital currencies so they can strike a balance with private issuers.
John said it was “really important” BoE and other central banks considered whether digital currencies could form the basis of a new payment system and, if so, “quicken the pace” on determining how to regulate the new asset class.
John, who as the BoE’s chief cashier is responsible for issuing banknotes in the U.K., said it was “so crucial” that central banks also determine how to define the role of private companies issuing their own cryptocurrencies in future, such as Facebook’s involvement with the Libra project.
The BoE was one of seven financial institutions that co-founded a new working group in January with the aim of sharing research and findings into central bank digital currencies (CBDCs).
Other working group members include Sweden’s Riksbank, which announced Friday it would soon pilot a new e-krona initiative, expected to run until 2021, that would increase the bank’s knowledge of CBDCs by testing the digital currency in a series of scenarios and stress-tests.
Sources have also told the Japan Times that the Bank of Japan (BoJ) – another member of the working group – has had several meetings with the Finance Ministry and Financial Services Agency (FSA) to discuss potential economic effects of digital currencies as well as move forward on collaborative research.
BOJ Governor Haruhiko Kuroda said: “We are advancing research and study from the technical and legal perspectives so that we will be able to move in an appropriate way when there is a growing need.”
Japanese politicians had expressed concern digital currencies, such as the one being developed by China, could seriously challenge the existing dollar-based economic order. Although there were no plans to launch a digital currency, the BoJ deputy governor said in January the bank was laying the groundwork by researching the technology.
‘We’ve Got to Be Careful’ With Crypto Regulation, Says QUOINE Co-Founder
Speaking during an on-stage panel at BlockShow Asia 2019, QUOINE co-founder Mike Kayamori said he has always been in favor of crypto regulation, but has begun changing his mind: “Crypto is evolving, and the government can’t try to regulate things it still doesn’t understand.”
Kayamori said he’s “always been a pro-regulation person”, but there is cause for being careful. “Politicians have their own agenda,” he said. “I am still in favor of crypto regulation, but it needs to be done very carefully.”
Crypto regulation has been one of the hottest topics at BlockShow Asia 2019, with almost every speaker offering their own take on the topic. Regulation has the powerful capacity to affect the whole industry.
During the same panel, crypto content creator Lark Davis said, “When some countries like Nepal, Algeria, and Saudi Arabia banned crypto a while ago, I thought it was so bad for a technology pretending to be global. But now there are some very good initiatives from governments in places such as France, Switzerland, Japan.”
Only time will tell how it all shakes out.