Today saw the launch of a UK-based cross industry group, the Digital FMI Consortium, which is planning privately led trials of new digital currency payment rails such as retail central bank digital currency (CBDC). The consortium includes IBM, Finastra and several fintechs with Boston Consulting Group (BCG) as consulting partner and supported by the UK’s Payment Association.
While banks are mentioned, there are none in the announcement so far. However, a Barclays representative was involved at an earlier event about the project.
The Project New Era pilot of digital sterling will start in the autumn. It aims to test potential digital currency use cases that may prove useful for CBDC design considerations and stablecoin regulation.
“The emergence of digital currencies represents the biggest technological revolution since then (the web), and the final step in the full digital transformation of the global financial system,” said Paul Sisnett, the CEO and co-founder of ‘paywith.glass’, the Dutch digital currency infrastructure that founded the consortium. “The global race for the future of money is well underway, and we couldn’t be more excited to be leading the UK’s ambition to set the pace.”
Other consortium members include FinClusive, Ibanera, Mattereum, Trust Payments and Accomplish Financial, with Rosa & Roubini Associates providing economic consulting and Simmons & Simmons as legal counsel. The reference to Roubini is indeed Dr Nouriel Roubini who is known for his opposition to cryptocurrency although he is a backer of CBDC.
Apart from the Bank of England’s work on a digital pound, the Digital Pound Foundation is also exploring digital currencies such as CBDC and stablecoins. Its members include Accenture, Avalanche, Billon Group, CGI Group, Electroneum, Quant and Ripple.
The UK government provided a grant to Millicent, which is trialing a retail synthetic CBDC. On the wholesale front, the Fnality banking consortium plans to launch an interbank payment system based on a synthetic CBDC later this year.