In a recent report, they caution against launching the currency with high-value transactions to prevent the risk of triggering bank runs. They emphasize the ongoing importance of cash and privacy protection.

The Bank of England and the Treasury anticipate a possible electronic pound later this decade, while other countries also explore this option.

However, the Treasury Select Committee urges the consideration of the potential benefits against the costs, emphasizing that solid evidence is required before a digital pound is integrated into the financial system.

With the possibility of digital pounds being used for payments, the Bank of England suggests a 20,000-pound limit per digital wallet, a figure notably higher than the European Central Bank's proposal for a digital euro. Yet, to avoid destabilizing financial markets, the committee proposes starting with lower limits.

Concerns have been raised about privacy and the survival of cash in light of a digital pound. The committee recommends any enabling legislation ensure that digital pound data is only accessible to authorities under current legal provisions for law enforcement.

The committee suggests revisiting the Bank of England's stance on not paying interest on digital pound deposits. Both the Treasury and the Bank of England intend to respond to the report and outline further actions.

In a statement, the Treasury and the Bank reaffirm that any digital currency would coexist with cash and prioritize privacy.