Amid an "unprecedented" 50,000-person privacy debate, the UK enters the design phase of digital pound
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Amid an "unprecedented" 50,000-person privacy debate, the UK enters the design phase of digital pound
State-issued digital currencies are a red flag for Western privacy advocates, who fear surveillance.
Navigating Web3 tides with focused insightsSource: DLNews
Translation: Blockchain Knight
There are concerns that privacy could be compromised if the UK launches a digital pound.
This is one of the key findings in a new report released by the UK Treasury and the Bank of England. Published on Thursday, the report draws on responses from 50,000 companies and individuals regarding the government's proposed central bank digital currency (CBDC).
The report states: "Many respondents expressed concerns that the digital pound might infringe upon their rights."
It promises to alleviate these worries by stating, "Safeguards will be established to protect the public’s rights and privacy," adding that the legislation will ensure user privacy while guaranteeing neither the Bank of England nor the government will control how people spend their money.
The release of the report comes as CBDCs have become a hot topic on both sides of the Atlantic, with privacy concerns at the heart of the debate.
In the European Union, the digital euro has faced strong opposition from policymakers and privacy advocates, forcing EU officials to defend the project amid fears it could become a "Big Brother" surveillance tool or a "conspiracy."
Former U.S. President Donald Trump has targeted CBDCs, calling the prospect of a digital dollar a "threat to freedom." Trump is currently running for president again.
Supporters of the digital pound have pushed back against such concerns.
Jannah Patchay, executive director and policy lead at the Digital Pound Foundation, told DL News: "This isn’t about digital currency—it’s more about general distrust in government."
Nonetheless, Patchay noted that receiving 50,000 responses to the consultation first launched in February 2023 was unprecedented—especially compared to the European Central Bank, which received just over 8,000 responses during its digital euro consultation in January 2021.
The digital pound has been in development since at least 2021, when then-Finance Minister Rishi Sunak urged the government to support the initiative, dubbing it "Britcoin."
Since then, Sunak has become Prime Minister, and the government has taken steps to advance CBDC development—with this newly published report representing the latest milestone in that long journey.
Still, there remains a long way to go before it becomes a reality.
First, the government must conduct another consultation to draft relevant legislation. Then, both houses of Parliament will need to debate the bill to establish a legal foundation for the CBDC.
In the meantime, the government and central bank are moving forward with the design phase of the digital pound.
According to the report, this stage will include proof-of-concept work and further "engagement with the public, businesses, and wider stakeholders."
The government and central bank also aim to reassure the public by establishing safeguards against programmability—meaning the state will have no authority to control individual spending.
Ian Taylor, board advisor at trade association CryptoUK and head of crypto assets and digital assets at KPMG UK, said: "Given current narratives from China and Republicans in the U.S., it will be very difficult to change perceptions around privacy concerns related to central bank digital currencies."
In China, the state-issued digital yuan is undergoing pilot testing—a red flag for Western privacy advocates concerned about surveillance.
The digital pound has drawn sharp criticism from leaders in the crypto industry, who see it as an unnecessary step that undermines the UK's ambition under Sunak to become a hub for digital assets.
Oliver Linch, CEO and General Counsel of cryptocurrency exchange Bittrex Global, said in a statement that CBDCs are, at best, meaningless and, at worst, harmful.
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