UK Legislators urge caution in retail digital pound rollout

                  British legislators are urging a careful stance regarding implementing a retail digital pound. They stress the importance of finding an equilibrium between technological advancements and potential drawbacks. 

Members of the Treasury Select Committee have expressed reservations regarding the possible launch of a retail digital pound, underscoring the need for thoughtful examination before execution. Despite recognizing potential advantages in terms of innovation, the committee has urged the Bank of England (BoE) and Treasury to thoroughly assess the necessity of such a step, considering both associated costs and risks.

In the interim, the committee’s report recommends imposing lower initial limits on the value of retail digital pounds to alleviate the risk of potential bank runs amid market instability. This specific precautionary measure aims to deter significant transfers of deposits into digital wallets, which could heighten the risk of bank failures and elevate loan costs.