Bank of England to exchange digital asset experts with NY financial services regulator

The Bank of England will exchange staff with the New York Department of Financial Services (DFS) to support greater sharing of regulatory approaches, information, and resources.

In the first swap, which will take place next month, they will exchange senior staff with expertise in emerging payments and digital assets.

The secondment position was open to internal candidates at DFS with demonstrated expertise in digital payments, distributed ledger technology, virtual currency, or digital assets

“This opportunity to strengthen cooperation between the Bank of England and the New York Department of Financial Services is a great initiative,” said Sarah Breeden, deputy governor for financial stability, Bank of England. “By sharing our knowledge and learning from one another, we can better ensure that regulation supports global financial stability and safe innovation in payments and financial markets.”

Secondments will be a minimum of six months and extendable up to one year.

Those taking part in exchanges are expected to return to their home regulator where they can bring their enhanced insights, knowledge and experience to work on regulation of emerging financial services and technologies.

“We’re thrilled to partner with the Bank of England in this kind of exchange for the very first time, working together to strengthen regulatory frameworks, protect consumers, and support innovation,” said superintendent Adrienne A. Harris, DFS. “Connecting the two global financial capitals of New York and London is critical for regulatory harmonisation in world where financial services are not defined by geography.”

The move comes after the governor of the Bank of England has confirmed that the central bank is continuing to prepare for a retail CBDC.

During a speech in October, governor Andrew Bailey said that the Bank is justified to prepare for a digital currency because it has “not yet seen enough evidence” that the innovation will happen in commercial banks.

At the Group of Thirty’s 39th Annual International Banking Seminar in Washington, the governor told industry figures that while commercial banks are the “best home” for CBDC innovation, if for some reason this is unlikely to happen, central banks must decide whether they are the “only game in town”.

The exchange programme also follows the publication of the UK’s National Payments Vision, a strategic plan that aims to boost the UK payments industry.

The Vision, which is part of the government’s broader mission to support economic growth and improve living standards across the United Kingdom, has set several goals aimed at strengthening the landscape, facilitate competition, and ensuring security.

Top priorities include strengthening coordination to address “congestion” in the regulatory landscape, supporting the development of Open Banking, and ensuring high standards of consumer protection so that individuals and businesses can make payments efficiently and safely.