If the UK launches an official digital currency, Crown Subjects will not be able to hold more than £20,000 in that form. This will be reported Reuters with reference to the deputy governor of the Bank of England John Cunliffe (Jon Cunliffe).
The UK government, with support from the Bank of England (UK’s central bank), is continuing to work on a digital pound to be launched in the second half of the decade. The electronic currency is kept in wallets that can be opened by commercial banks. “We propose a cap of £10,000 to £20,000 per person as a fair balance between risk management and widespread adoption of the digital pound.”said Mr. Cunliff.
Setting a lower limit would mean three quarters of Brits would be able to be paid in digital pounds and hold funds in the same account. The £20,000 limit will allow almost anyone to use the digital pound in everyday transactions. Funds exceeding this limit will be transferred to customer accounts at commercial banks, meaning the digital pound will not become a tool for hoarding money. Otherwise, Mr Cunliff concluded, electronic money will be given the same legal status as cash.