A stablecoin will likely serve as a “first use case of what is likely to be a wholesale settlement coin” in the “long runtime” leading up to the potential introduction of a central bank digital currency (CBDC), Member of Parliament and HM Treasury Economic Secretary Andrew Griffith said.

Griffith defended the work being done on stablecoin, saying stablecoin is “here now” and so in need of immediate attention and noting that it is unclear whether a CBDC would displace private stablecoins on the market if a CBDC were introduced.

It is “not the government’s position that this [crypto-based technology] is an inevitability,” Griffith said, but he added that current technology cannot solve issues in the financial sector such as settlement time “in a disruptive way,” as blockchain technology can.