The creation of an official digital currency in Britain could increase the risk of a run on the banks in an economic downturn, an influential House of Lords committee has found.
The committee, whose members include Lord King of Lothbury, the former Bank of England governor, expressed serious reservations about the introduction of a central bank digital currency, or CBDC, dubbed “Britcoin” by Rishi Sunak, the chancellor.
The Bank has overstated the benefits of such a currency, the report by the Lords’ economic affairs committee found, while the risks are considerable. It concluded that there was “no convincing case” for Britcoin, while potential dangers included the risk of bank runs, privacy issues and the possibility of making the UK vulnerable to attack by hostile
