March 29, 2024

John Cunliffe: UK may need digital pound after FTX crash

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John Cunliffe: UK may need digital pound after FTX collapse

The Deputy Governor of the Bank of England said that the consequences of the collapse of the FTX exchange may cause the regulator to need to accelerate the release of a government stablecoin into circulation.

Speaking at a forum at Warwick Business School on DeFi and digital currencies, Bank of England Governor Jon Cunliffe said:

"Over the past few days I have hadseveral comments both that the collapse of FTX not only shows that we need to continue working hard and quickly release a digital pound, but also that the example of FTX shows what not to do.”

John Cunliffe assured that the Bank of England is providingactively assisting UK legislators with the issuance of regulations governing the crypto space. The official said that parliament is currently discussing a bill on financial services and markets, which could ultimately classify cryptocurrencies as financial instruments. This will allow the Bank of England and other UK regulators to gain greater control over the crypto industry. The bill intends to give the central bank the power to regulate large issuers of payments focused on crypto assets, such as stablecoins.

Exactly one year ago, Bank of England Governor AndrewBailey and his deputy John Cunliffe took part in a meeting of the Parliamentary Economic Affairs Committee, where they told lawmakers about the Bank of England's support for the possible release of a digital pound, as well as settlements using it, which could potentially affect about 20% of all payments in country.