Professor Sheri Markose has been selected to join the Bank of England and HM Treasury Central Bank Digital Currency (CBDC) Academic Advisory Group starting January 2024


The UK Government aims to supplement notes and coins of the state with a digital variant to be called the Digital Pound, which the popular press refers to as the Britcoin.

Sheri Markose has been invited to join the Bank of England and HM Treasury Central Bank Digital Currency (CBDC)

Sheri has long worked on cashlessness since the early 2000’s, tracing the substitution away from physical cash in retail payments. From mid to late 1980’s onwards, debit card and credit cards payments based on bank deposit money was first introduced in so called Electronic Fund Transfers at Point of Sale (EFTPOS) followed by their increasing use in e-commerce. This change in payment habits from physical cash to digital payments was made possible by the technological advancements in Information and Communication Technology (ICT) with the World Wide Web (www) and numerous innovations relating to secure digital payments and contactless payments. These developments meant that bank deposit money which constitute liabilities of private sector firms in advanced cashless  economies account for 97% of what is called broad money.

2009 saw a radical new development in the form of Bitcoin which has been followed by over 8000 privately issued peer-peer digital money called cryptocurrencies. These are independent of currency of the state and bank deposit money.  Cryptocurrecies rely on modern cryptographic technology within the protocol of a blockchain distributed ledger to keep records of peer-peer payments secure and free from digital counterfeiting. One form of it called double spend is the case when effectively the same unit of currency is used twice.  In physical cash this problem does not arise in that once cash is used in a payment and it leaves the payor’s possessions to the payee/merchant, the payor cannot use it again.  Also, creating a physical counterfeit is harder to do than in the case of digital records.

With less and less cash being used in payments and with the threat of private digital currencies circulating at different parities to the currency of the state in national jurisdictions, many countries are looking to issue CBDCs. Some have already done so.

Sheri’s main area of interest is to see the extent to which CBDCs will make inroads on bank deposit money. This could lead to possible substantial shrinkage of commercial banking and or sudden runs on it.  Is there a way of designing CBDC such that it does not bring about either of the latter.

Sheri is working on large scale agent based models to test this out and also on models of network effects in the adoption of new payments media.


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