Are we ready for Britcoin?

The House of Lords has asked Ben Broadbent, deputy governor of monetary policy at the Bank of England, to explore the possibility of introducing a central bank digital currency via distributed ledger technology (DLT), akin to Bitcoin and blockchain.

At Teamspirit, we’ve been following the rise of DLT for some time, looking at which industries, organisations and governments are starting to explore the potential applications for this new technology.

Across financial services, the introduction of DLT offers the potential for increased administration efficiencies across - Broadbent predicts it could produce around $16billion in yearly admin savings for the sector - and could help make banks safer against problems like market instability by reducing the risk of a run if a lot of people suddenly want to close particular accounts.

But, Broadbent has also cautioned against the potential over-reach of DLT. If people are able to hold digital accounts with the central bank and begin to take their deposits away from banks, financial institutions could find it harder to make loans and have to rely more on wholesale markets and focus less on consumer offerings.

To find our more about what DLT might mean for finance, read our new paper – Culture and Communications in a Blockchain World