Bank of England receives 20 applications to develop CBDC wallet prototype
Twenty companies have submitted applications to create a digital wallet for the Bank of England’s CBDC project.
The bank underlined its desire to pursue a central bank digital currency by putting a contract for a sample wallet out to tender only three weeks ago, setting a deadline to complete applications by December 23.
Despite the remarkably tight turnaround for the £200,000 five-month project, 28 applications were made, although eight didn’t pursue the contract bid beyond the deadline for questions on December 16. The completed applications are made up of nine SMEs and 11 ‘large’ companies.
According to its website, the bank wants to to develop a mobile wallet app, merchant website and a back-end server for the core ledger.
It is understood the contract is purely to establish a prototype for user experience testing.
While largely scoffed at by the cryptocurrency industry, there are plenty of backers for the concept of a UK CBDC.
One of its supporters – Gilbert Verdian, founder and CEO of Quant – believes a well-designed CBDC could help provide a real-time view of risks and currency outflows to help implement specific and targeted measures to prevent financial contagions from spreading further in the event of a crisis.
“A digital pound enables consumers and businesses to automate complex and cumbersome processes and implement logic into money,” he explained.
“It offers new efficiencies and faster workflows to better meet our needs as our living experience becomes increasingly digital.
“Many critics cite privacy and potentially overbearing government controls as barriers to implementation. They are missing that blockchain technology makes it possible to protect the privacy of individuals.”
He added that many countries were taking very considered approaches to adoption.
“Pilots involve extensive public and regulatory consultation, with business and institutional involvement, to ensure that CBDCs meet our democratic needs,” he said.
“Meanwhile, with Project Rosalind, the BIS Innovation Hub London and the Bank of England are looking to the future – testing how to issue, embed and settle CBDCs for retail payments use cases with industry participants.
“The project includes the private sector in an effort to innovate different payment use cases and applications that use retail CBDCs for a better experience.”