Designed to integrate smoothly with the current financial system, including cash and emerging digital currencies, the digital pound will establish stringent standards to ensure a secure, reliable, and easily accessible payment platform.
The BoE is in the process of exploring the concept of a digital pound and considering the technology and policy requirements. They are publishing design notes that are part of a broader design phase that includes four main workstreams: the development of a blueprint, proofs of concept and experimentation, engaging in a national conversation, and an assessment phase.
Earlier this year the BoE published a design note setting out its initial thinking for a blueprint framework for a digital pound. The blueprint aims to offer a detailed proposition for a digital pound, covering technological, operational, ecosystem, commercial, regulatory, and financial factors, as well as defining the roles of the BoE and the private sector in its implementation. This has been followed by a recent update from the BoE publishing further design notes on key issues, including interoperability, product strategy, and intermediary roles. Additional design notes which have been published with this update cover the following:
- Alias service – the alias service design note explores how account aliases could enhance retail payments and outlines key functionality for a digital pound alias service.
- Offline payments – explains how deferred offline payments could work in addition to future consideration of device offline payments.
The paper also provides a progress update on the BoE’s recent work on the digital pound. It states that three main priorities have guided recent work: advancing technical experimentation (notably via the Digital Pound Lab), exploring interoperability between digital and traditional money, and engaging with stakeholders to inform design. The Digital Pound Lab was launched in August 2025 for industry to test use cases and explore potential business models for a digital pound. Phase 2 is now open for applications, allowing industry participants to test innovative payments use cases, using a digital pound as the foundation.
Next steps and considerations for firms
The digital pound's design phase adopts a thorough approach, involving the development of a detailed blueprint focused on technological, operational, and regulatory considerations. It features an inclusive national conversation to incorporate diverse stakeholder perspectives in order to refine the digital pound's framework to meet the diverse needs of the economy and its participants effectively. The design phase of the workplan will run through 2026. The BoE is aiming to complete the blueprint and assessment as soon as possible, which will inform a decision by the BoE and HM Treasury on next steps in 2026.
It seems the regulatory framework for the UK's digital pound is developing at a cautious, yet consistent, pace. Banks and payment service providers should monitor the development of the digital pound blueprint and participate in stakeholder engagement opportunities, including the Digital Pound Lab, to influence policy and prepare for potential changes to the payments landscape. Firms should consider potential commercial opportunities such as, developing new digital payment products, leveraging interoperability with the digital pound, and accessing new customer segments. They should also consider relevant risks and assess their capability in adapting to new technical standards, complying with future regulatory requirements on resilience and privacy, and managing the challenges of integrating with a multi-money system.
