Bank of England Considers Dropping CBDC Plans Amid Rising Doubts

Britain’s central bank is rethinking its consumer-focused CBDC initiative, reflecting growing uncertainty over its value for the UK’s financial system.

According to Bloomberg, the Bank of England (BoE) is reconsidering its plans to launch a digital pound, citing increasing doubts about its necessity and benefits. Governor Andrew Bailey told Parliament’s Treasury Committee on Tuesday that if commercial banks can innovate successfully in payment systems, the BoE would need “a lot of convincing” to proceed with a CBDC.

Skepticism Grows Around Digital Pound Necessity

“I think that’s a sensible place to do it,” Bailey remarked, suggesting that if private sector solutions can modernize payment infrastructure efficiently, a state-backed digital currency may not be required. This marks a notable shift from the BoE’s stance in 2023 when Bailey had stated that a digital pound was “likely needed” in the future.

The UK’s CBDC development has lagged behind other jurisdictions, with the Atlantic Council noting that Britain’s digital pound remains in the development stage while other countries advance to pilot phases. 

No final decision has been made, but the cautious tone from the BoE signals that the digital pound project could be shelved if alternative payment innovations prove effective.

Global CBDC Momentum Slows as Privacy Concerns Persist

The UK’s potential retreat aligns with a broader slowdown in CBDC enthusiasm globally. The digital pound initiative has faced criticism from lawmakers, conspiracy theory groups, and citizens, with over 50,000 public responses—mostly critical—raising privacy concerns and fears of potential bank runs during financial crises.

Concerns have also surfaced over the risk of Big Tech or foreign stablecoins undermining the British pound if a domestic digital currency is not pursued. However, skepticism around CBDCs is not limited to the UK. In the United States, the House recently passed the Anti-CBDC Surveillance State Act, blocking the Federal Reserve from issuing or testing a digital currency without congressional approval.

Only three countries—The Bahamas, Jamaica, and Nigeria—have officially launched CBDCs. Meanwhile, 49 countries are piloting projects, 20 are in development, and 36 remain in research phases, according to the Atlantic Council’s tracker.