A financial think tank has recommended that the UK government create a digital pound to strengthen London’s position as a global trading hub after Brexit. Previously the centre of gravity for Europe’s financial sector, London lost much of its weight at the end of 2020 when the UK left the European Union.
The UK Treasury will contemplate this proposal, which could make the country more appealing to global traders, as attention has now shifted to other European trading centres, such as Amsterdam and Frankfurt.
“The Bank of England is examining the introduction of CBDC, and this must be the main concern as this technology is the future of finance. It will also bring other advantages, such as real-time regulation to reduce costs,” believes Daniel Hodson, chair of the think tank CityUnited.
Hodson further noted that the advancements made by China in launching their CBDC should alarm British financial authorities:
“The central bank digital currency must grow to be the fundamental base for a competitive economy post Brexit, if not, China will create a great lead.”
The invention of the digital yuan is believed to be aimed at realizing а global economic influence. By conducting enhanced digital currency trials, the Chinese authorities plan to present its development by the beginning of the Beijing Winter Olympics in 2022.
