The Bank of England and the British Treasury have announced the joint creation of a Central Bank Digital Currency (CBDC) Taskforce to coordinate the exploration of a potential new form of digital money issued by the Bank of England and for use by households and businesses.
While the announcement was made by Chancellor of the Exchequer Rishi Sunak as part of the UK Government’s response to the Kalifa Review, the new digital currency would be alongside cash and bank deposits, rather than replacing them.
Aims of the task force
In addition, the Taskforce aims to ensure a strategic approach is adopted between the UK authorities as they explore the digital currency, in line with their statutory objectives, and to promote close coordination between them. The Taskforce will:
- Guide evaluation of the design features a digital currency must display to achieve our goals.
- Coordinate exploration of the objectives, use cases, opportunities, and risks of a potential UK CBDC.
- Support a rigorous, coherent, and comprehensive assessment of the overall case for a UK CBDC.
- Monitor international CBDC developments to ensure the UK remains at the forefront of global innovation.
The Taskforce will be co-chaired by Deputy Governor for Financial Stability at the Bank of England, Jon Cunliffe, and the Treasury’s Director General of Financial Services, Katharine Braddick.
Commenting on the announcement, John Whelan, MD Digital Investment Bank & Innovation, Banco Santander expressed his excitement “to see this development from the Bank of England supporting the opportunity to use tokenized cash assets on next generation payment systems, enabling on-chain wholesale exchange of value.”
In parallel, the Bank of England announced the establishment of a CBDC Unit, which will lead its internal exploration around the currency, as well as leading the Bank’s external engagement on CBDC, including with other UK and international authorities.
Banks searching for digital currency
“We’re launching a new taskforce between the Treasury and the Bank of England to coordinate exploratory work on a potential central bank digital currency (CBDC),” British finance minister Rishi Sunak told a financial industry conference.
Other central banks are also looking at whether to set up digital versions of their own currencies, essentially widening access to central bank funds which only commercial banks can use at present. This process would speed up domestic and foreign payments and reduce financial stability risks.
While China is a front-runner to launch a CBDC, the European Central Bank said it was studying an electronic form of cash to complement banknotes and coins, but any launch was still several years away.
Bitcoin jumps on speculation that Amazon considering crypto
Bitcoin’s price surged again Monday after speculation that Amazon may be entering the cryptocurrency sector after it posted a job seeking a “digital currency and blockchain product lead.”
Bitcoin jumped more than 14% in the past 24 hours, nearly reaching $40,000 per unit before settling closer to $37,000. The five-week intra-day high reached Monday comes after a long slide where it dipped under $30,000 from an April high of nearly $65,000.
There is also speculation that the price surge may have also been a result of traders buying up bitcoin to fill positions they were short on, having bet its value would fall further. But it’s difficult if not impossible to track short positions on the cryptocurrency.
Amazon’s job listing says the company is looking for “an experienced product leader to develop Amazon’s Digital Currency and Blockchain strategy and product roadmap.”
The Seattle-based online retail giant currently has 74 listings for jobs whose descriptions include the words “blockchain,” the backbone of cryptocurrencies, many dating back to earlier this year. However, the jobs are not necessarily related to blockchain development, but list blockchain background as relevant experience for those applying for the job.
In a statement, Amazon rejected as “fabricated” a report that said it would be accepting payments in cryptocurrency by the end of the year, and that it could launch its own digital coin in 2022.
But it did acknowledged that is exploring what the use of cryptocurrencies would look like on Amazon.
“We believe the future will be built on new technologies that enable modern, fast, and inexpensive payments, and hope to bring that future to Amazon customers as soon as possible,” the company said.
Tom Forte, a senior research analyst who covers Amazon for the investment bank D.A. Davidson, said he doubts Amazon will accept bitcoin across its platform any time soon. Forte noted bitcoin accounts for less than 1% of transaction payments on Overstock.com, one of the few online retailers to accept the cryptocurrency.
“It’s been an effective mechanism for trading and speculation, but it hasn’t shown to date to be a form of currency for payments,” Forte said.
Proponents of bitcoin seem to have shifted their pitch from its value as a digital currency, focusing more on applying it as “store of value,” like gold or other commodities.
Bitcoin is not tied to a bank or government and allows users to spend money anonymously. The coins are created by users who “mine” them by lending computing power to verify other users’ transactions. They receive bitcoins in exchange.
NEW YORK (AP)
Amazon seeks to look into Blockchain amongst latest hype
Amazon displays a lenient approach towards digital currencies as a new job listing was posted on Friday on the e-commerce site seeking a digital currency and blockchain specialist to lead its payments team.
As one of the biggest e-commerce companies in the world, Amazon is responsible for securing some of the widest transactions through various payment methods.
The tech giant’s Payments Acceptance and Experience team is reaching out to find a qualified product leader to create Amazon’s Digital Currency and Blockchain strategy.
As a product leader, it is required to work diligently with the company’s team to create a roadmap which includes customers experience, technical strategy, and capabilities.
The e-commerce titan confirmed the listing’s legitimacy by confirming the announcement to the Insider.
“You’ll need to operate with a high level of autonomy and operate analytically, working backwards from data and customer insights to build new and innovative solutions to unsolved problems. As a product leader you will have a proven track record of creating a strong vision and roadmap and successfully delivering results,” Amazon added to its job listing site.
Amazon was “inspired by the innovation happening in the cryptocurrency space and are exploring what this could look like Amazon,” a spokesperson told the Insider.
This came as a shock since the Seattle-based company was extremely vocal in the past towards its stance regarding accepting cryptocurrency as a payment. However, it is worth highlighting that Amazon already has a managed blockchain service in its cloud division, Amazon Web Services (AWS).
Amazon Managed Blockchain is a fully controlled service that simplifies joining public networks or creating accessible private networks by employing famous open-source frameworks such as Ethereum. This will allow multiple parties to perform transactions without a central entity.
Back in 2017 – the recently appointed CEO Andy Jassy and former head of the AWS division – announced in a statement that Amazon’s AWS department was not buying into the blockchain hype and not interested in switching its focus to the technology that is capturing everyone’s attention.
Jack Dorsey announces Bitcoin plans for Twitter
Twitter CEO Jack Dorsey confirmed to investors the significant role Bitcoin will play in the platform’s future by planning to incorporate cryptocurrency into the company’s current products and services.
Dorsey has been a die-hard Bitcoin advocate since its inception into the market, but now the world is witnessing his commitment to cryptocurrency as he plans on integrating Bitcoin into his platform’s commerce and subscription services, alongside some of its contemporary additions like Tip Jar and Super Flows.
Actions the tech philanthropist is planning on implementing into his platforms have not yet been announced in detail.
Today, as one of Bitcoin’s biggest supporters, Dorsey is proposing to investors to move the company faster in terms of Twitter’s product expansion, while emphasizing on how it is the ideal candidate to be the next native currency of the internet.
“If the internet has a native currency, a global currency, we are able to move so much faster with products such as Super Follows, commerce, subscriptions, Tip Jar, and we can reach every single person on the planet because of that instead of going down a market-by-market approach,” Dorsey explained in a statement.
This announcement will be the first time that Dorsey publicly addressed the topic of integrating Twitter with digital currencies, while adding that the platform cannot be the only social networking app considering the pursuit of crypto strategies.
He further highlighted that Facebook was backing blockchain-based payment system, Diem.
Back in February, Twitter chief launched a $23.6 million Bitcoin fund with popular Hip Hop artist Jay Z as a new plan to fund Bitcoin development into other hardware company Square Inc.
This will lead Square into decentralized financial services into the Bitcoin market as blockchain technologies and cryptocurrency could change the company’s business.
Now, Dorsey’s biggest goal is to label Bitcoin as one of the three main elements in Twitter’s future, parallel to Artificial Intelligence and decentralization – which Twitter is shadowing through its “Bluesky” initiative.
Bluesky initiative is a non-profit social networking protocol with the intention of creating a decentralized standard for social media platforms, including Twitter. Dorsey spoke of expanding the concept of decentralization on social media platforms while addressing some of the biggest centralized entities such as Google and Facebook.
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