Bank of England official says it is 'crucial' for central banks to consider digital currencies

The Bank of England's chief cashier and director of notes, Sarah John, has said that it is "crucial" for central banks to research digital currencies before private companies dominate the space.

"We need to think as an institution about how to position ourselves to make sure society still has a broad range of payments that it can use with confidence," John told The Telegraph U.K. in an interview published Saturday. "It is absolutely right that central banks think about whether a public sector or private sector would be best to provide a digital currency going forward," she added.

Central banks around the world are increasingly dabbling in digital currencies. Last month, the Bank of England formed a group with five other central banks - the Bank of Canada, the Bank of Japan, the European Central Bank, the Sveriges Riksbank (Sweden) and the Swiss National Bank - to explore potential use cases for digital currencies.

In August, outgoing Bank of England Governor Mark Carney said a central bank-supported digital currency could replace the U.S. dollar as the global hedge currency. Carney's term ends on March 15. Andrew Bailey, currently the CEO of the U.K.'s Financial Conduct Authority, would take over Carney's role from March 16.