The UK Treasury Committee released a report on December 2, advising the Bank of England to proceed cautiously with plans for a retail digital pound, citing concerns that its introduction could spark bank runs and destabilize the financial system. In their report, the cross-party group of MPs urged the central bank to impose strict limits on individual holdings of a digital currency, arguing lower thresholds could reduce risks of large-scale outflows from commercial bank deposits. The committee warned that easy conversion of deposits into digital pounds could see consumers quickly withdraw funds at times of economic stress, increasing the likelihood of bank failures.
The UK Treasury Committee’s Report on the Retail Digital Pound
