Andrew Bailey denies Farage swayed Bank of England CBDC stance

The Bank of England has reaffirmed that its work on a potential digital pound has remained independent despite claims that political lobbying may have influenced its approach.

Bailey says CBDC policy remained independent

According to The Guardian, Bank of England Governor Andrew Bailey said the central bank did not alter its position on a potential central bank digital currency after meeting Reform UK leader Nigel Farage.

The newspaper reported that Bailey made the comments in a letter written after the meeting, which covered several topics, including cryptocurrencies.

In the letter obtained by The Guardian, Bailey reportedly said the Bank of England is capable of identifying attempts to influence its policymaking. He also wrote that no policy changes had resulted from Farage’s interventions after the meeting.

Bailey’s response came after Farage publicly said he had discussed cryptocurrencies with the governor. According to The Guardian, Bailey confirmed the meeting took place but rejected any suggestion that the conversation affected the Bank’s work on a digital pound.

Farage has repeatedly criticized central bank digital currencies, arguing they could increase financial surveillance. He previously said he would “rather go to prison” than live under such a system, a position he has maintained while opposing the proposed digital pound.

Farage faces scrutiny as digital pound research continues

Separately, Farage has resigned as the Member of Parliament for Clacton and will contest a by-election while parliamentary investigations into his financial declarations continue.

During an X livestream on Tuesday, Farage said he stepped down so local voters could decide whether he should continue representing the constituency instead of waiting for the outcome of the investigations.

Farage said he had “done nothing wrong” and maintained that he had not broken any laws or misused public money. He also confirmed that the UK parliamentary standards commissioner is investigating two matters involving gifts he received from crypto billionaire Christopher Harborne and George Cottrell, who has a previous fraud conviction and has been linked to a crypto casino.

According to Farage, the money provided by Harborne was an unconditional gift that would be used to pay for his personal security because of threats and attacks against him. He said seeking re-election would allow voters in Clacton to judge his actions directly.

Meanwhile, The Guardian reported that the UK’s National Crime Agency is investigating several transactions involving other senior Reform UK figures over suspected money laundering. The report did not say that Farage was part of that investigation.

While those political developments continue, the Bank of England has kept its digital pound project under review. In a recent update, the central bank said no decision has been made on whether to introduce a digital pound and added that any launch would require further analysis and public consultation.

Earlier this year, the Bank of England began a six-month pilot involving 18 companies to test how tokenized assets could be settled using central bank money. According to the central bank, the program is designed to examine settlement technology as officials continue evaluating whether a digital pound would have a role in the UK’s financial system.