Britcoin privacy preserved as Bank of England taps Nuggets for identity layer
The Bank of England (BofE) has stepped up its focus on privacy and security for its potential ‘Britcoin’ retail central bank digital currency (CBDC) through a collaboration with decentralised identity and payment platform Nuggets.
Nuggets is designing a privacy layer for the digital pound
The London-based firm says it is working with the BofE to “design a privacy-preserving identity layer” for a possible digital pound.
The agreement would see the design and deployment of a secure system that “prevents tracking and correlation of transactions while maintaining the highest standards of fraud and anti-money laundering prevention”, the company writes on LinkedIn.
The central bank recently collaborated with HM Treasury on the release of a consultation paper in February, where it was decided that a digital pound was likely needed. However, the paper also confirmed that any decision to issue one would not come about until at least 2025.
And while the industry waits for this decision to be reached, the matter of privacy and security has remained a key concern. With the BofE’s growing relationship with Nuggets, it appears that this narrative is being heeded.
Nuggets is becoming an increasingly familiar figure within the digital pound’s origin story. The platform was engaged in the phase-two techsprint of Project Rosalind, an initiative by the Bank for International Settlements (BIS) and BofE to facilitate retail CBDC payments through the consolidation of both the private sector and monetary authorities.
As part of this, Nuggets worked with the Rosalind APIs in a sandbox environment on a range of retail user functionality. This included creating a CBDC account, using CBDCs to make retail payments with verifiable receipts, making a CBDC micropayment and enabling the ability to freeze, unfreeze and delete a CBDC account all without sharing any personal identifiable information.
