UK is Confronting Challenges To Launch CBDC Project

At present, there is no specific law for cryptocurrency in the UK. The country considers crypto assets as property but not legal tender. Recently the UK Tax Reform Council has announced a campaign against the Bank of England’s new plans for Central Bank Digital Currency (CBDC). The research institute think tank also shared similar concerns about the UK Bitcoin community.

The Tax Reform Council believes that the launch of CBDC in the nation will affect the financial system and tax authorities. There will be a high chance of cyberattacks on the nation’s capital system due to CBDC.“This week we are launching our campaign against the introduction of a CBDC or Digital Pound in the UK,” the Council tweeted.

The newly formed Tax Reform Council is a non-profit public advocacy organization mainly focused on tax reforms in Britain. This Council includes John Chown, international tax specialist and Catherine McBride, Department of International Trade. The advisory board members, including Julian Jessop, Chown and Patrick Minford, stated, “The decision of the Bank of England to pursue a British CBDC raises a number of very real concerns.”

In Feb 2023, the UK Financial Conduct Authority (FCA) announced that it would take strict actions on unregistered crypto ATMs in the country. In Uk, the crypto exchanges must register with the FCA and obey UK money laundering regulations. Mark Steward, the executive director of enforcement and market oversight at the FCA, said, “Unregistered crypto ATMs operating in the UK are doing so illegally.”

The Central Bank of the United Arab Emirates (CBUAE) is working on new plans to introduce the Central Bank Digital Currency (CBDC). On Feb 12, the CBUAE newly launched the Financial Infrastructure Transformation (FIT) program, which was created as a part of the nation’s “We the UAE 2031” vision and National Digital Economy Strategy.

Meanwhile, along with CBDC, nine more initiatives have been added to this program. The first stage mainly focused on digital payment infrastructures and services like the issuance of domestic card schemes, instant payments platform and launch of CBDC for international transactions and domestic uses.

And the second stage of the FIT program detailed the setting up of the Financial Cloud, innovation hubs for the finance sector and eKYC. “These digital infrastructures will improve regulatory compliance, reduce the cost of operation, enhance innovation and customer experience, and most importantly strengthen their security and operational resilience,” CBUAE said.