{"id":313145,"date":"2025-10-18T10:17:09","date_gmt":"2025-10-18T10:17:09","guid":{"rendered":"https:\/\/www.europesays.com\/us\/313145\/"},"modified":"2025-10-18T10:17:09","modified_gmt":"2025-10-18T10:17:09","slug":"bank-of-england-prioritises-ai-dlt-and-quantum-computing-for-further-action","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/313145\/","title":{"rendered":"Bank of England prioritises AI, DLT and quantum computing \u2018for further action\u2019"},"content":{"rendered":"

\"\"<\/a>Bank of England: considers the three \u2018cross-cutting\u2019 technologies as having \u2018the most potential for transformative outcomes\u2019 | Credit: Ian Hall<\/p>\n

The Bank of England (BoE) has published a report setting out its strategy across artificial intelligence (AI), distributed-ledger technology (DLT) and quantum computing.<\/p>\n

The three areas are described by the UK central bank as the \u2018cross-cutting technologies that we are prioritising for further action, consistent with our focus on disruptive technologies with the most potential for transformative outcomes.\u2019<\/p>\n

The executive summary of the 36-page publication \u2013 \u2018The Bank of England\u2019s approach to innovation in artificial intelligence, distributed ledger technology, and quantum computing\u2019<\/a> (15 October) \u2013 describes the fields as having the potential to be \u2018the most transformative technologies of our time, with the potential to reshape the UK economy and boost productivity.\u2019<\/p>\n

The BoE uses the document to outline its approach to \u2018delivering the environment necessary to ensure that responsible innovation flourishes, setting out the work we have done and will do.\u2019 It focuses on three \u2018levers\u2019 that it can use: its \u2018hard\u2019 (physical or tangible) infrastructure; its \u2018soft\u2019 infrastructure (rules, regulations and standards); and its \u2018convening and co-ordinating\u2019 role.<\/p>\n

\u2018While we have focused on these as the three technologies with the greatest potential today to shape our economy and financial services, we recognise that technological trends are difficult to forecast,\u2019 BoE deputy governor (financial stability) Sarah Breeden writes in the foreword. \u2018Currently expected benefits may not materialise, and new technologies impacting our work will emerge in future. Our approach is flexible to that.\u2019<\/p>\n

AI use \u2018increasing rapidly\u2019<\/strong><\/p>\n

The AI section notes that deployment of the hot-topic technology is \u2018increasing rapidly\u2019 across the UK\u2019s financial services sector. According to a survey on AI use by the BoE and the Financial Conduct Authority (FCA) last year (2024)<\/a>, 75 per cent of respondent firms are already using AI, with a further 10 per cent planning to use AI over the next three years.<\/p>\n

In May, following an \u2018AI Public-Private Forum (AIPPF)<\/a>\u2019 that ran from 2020 to 2022, the BoE launched an\u00a0\u2018AI Consortium<\/a>\u2019. Co-chaired with the FCA, this is a \u2018group of AI experts, providing a platform for public-private engagement to gather input from stakeholders on the capabilities, development, deployment and use of AI.\u2019<\/p>\n

The strategy document explains that AI Consortium members will \u2018explore specific challenges and risks such as the growing reliance on third-party providers, increased use of similar AI models that could amplify systemic vulnerabilities, and the explainability and transparency of AI models.\u2019<\/p>\n

The document states that the BoE plans to \u2018engage with regulated firms further to understand how we can support adoption\u2019 and \u2018will explore future opportunities to supplement our engagement with insights from AI experimentation.\u2019<\/p>\n

Also mentioned is the Cross Market Operational Resilience Group (CMORG) \u2013 a public-private initiative co-chaired by the BoE\u2019s executive director for supervisory risk and chief executive of lobby group UK Finance \u2013 which has an \u2018AI Taskforce\u2019 to \u2018support the financial sector\u2019s ability to identify and respond to emerging risks posed by widespread adoption of AI technologies.\u2019<\/p>\n

BoE\u2019s own use of AI<\/strong><\/p>\n

The BoE published its internal AI strategy (\u2018The Bank\u2019s artificial intelligence (AI) strategy<\/a>\u2019) in August and summarises this in the new document.<\/p>\n

The August document explained that AI is an umbrella term encompassing sub-disciplines such as machine learning (ML), deep learning (DL) and generative AI (GenAI).<\/p>\n

The internal AI strategy, described by the BoE as a \u2018cornerstone\u2019 of its broader\u00a0\u2018data and analytics\u2019 strategy, has five goals: to use AI to increase productivity; promote and encourage experimentation; use AI effectively and responsibly; collaborate, learn from others and stay informed; and \u2018ensure AI works for our staff.\u2019<\/p>\n

Examples of current AI uses include predictive analytics, study of \u2018non-linear interactions between variables\u2019 and analysis of \u2018larger and richer data sets, which can potentially help forecast GDP growth and bank distress, for example.\u2019<\/p>\n

The BoE states that it has \u2018rolled out off-the-shelf AI assistants across the Bank, delivering productivity gains in a range of tasks including summarisation, note-taking and code generation\u2019; and adds that it is building bespoke AI solutions, for example, the Prudential Regulation Authority (PRA) \u2013 which is part of the BoE \u2013 is \u2018exploring the use of LLMs [large-language models] to enhance supervisory tools, supporting tasks such as data extraction and natural language querying.\u2019<\/p>\n

DLT on the rise<\/strong><\/p>\n

In the DLT section, the BoE gives examples of its involvement in Bank for International Settlement (BIS) Innovation Hub initiatives such as \u2018Project Meridian\u2019<\/a> and \u2018Project Agor\u00e1\u2019<\/a>.<\/p>\n

It also highlights that it is currently running a \u2018DLT Innovation Challenge<\/a>\u2019\u00a0alongside the BIS Innovation \u00a0London centre (which the BoE itself hosts). This programme engages with the private sector to better understand the implications of incorporating DLT into wholesale central bank settlement.<\/p>\n

The strategy then sets out how the BoE is \u2018adapting the execution of [its] core functions\u2019 to ensure that central bank money can interact with technologies such as DLT. As an example, it references that, since introducing an omnibus account policy in 2021, the BoE became\u00a0the first central bank to have onboarded a private DLT-based payment system \u2013 Fnality<\/a> in 2023. (An omnibus account at the BoE is a central bank money account for regulated payment system operators to hold a pool of their participants\u2019 funds).<\/p>\n

The BoE\u2019s renewed real-time gross settlement (RTGS) service (\u2018RT2\u2019) went live six months ago (April 2025). \u2018As part of the future roadmap for RT2, the Bank is working closely with industry to design and introduce a synchronised settlement interface that will allow RTGS to interoperate with other external ledgers, including those based on DLT,\u2019 the new strategy document notes.<\/p>\n

\u2018These platforms could include overseas RTGS systems and other asset ledgers such as land registries, to support more integrated financial transactions,\u2019 it continues, adding that the BoE plans to launch a \u2018synchronisation lab\u2019 in 2026 \u2018to enable potential synchronisation operators to test real-world use cases with our planned functionality.\u2019<\/p>\n

\u2018We are also planning a series of further experiments in wholesale settlement, exploring whether platforms based on DLT or other emerging technologies could offer capabilities beyond RTGS synchronisation to support the development of next-generation innovative use cases,\u2019 it adds.<\/p>\n

Quantum capabilities \u2018in early stages\u2019<\/strong><\/p>\n

Quantum computing \u2018in the not-too-distant future\u2026 could solve computational problems at scale that are beyond the capabilities of the best computers today,\u2019 the strategy\u2019s foreword summarises.<\/p>\n

\u2018There is considerable uncertainty around how quickly quantum computing will materialise,\u2019 the quantum-specific section notes. \u2018Quantum computing capabilities are still in the early stages of development, particularly in comparison to AI and DLT.\u2019<\/p>\n

Nonetheless, the BoE states that it has engaged with firms \u2018through CMORG and the FCA to understand firms\u2019 quantum readiness, which has helped us begin to map the practical implications of quantum technologies across the financial services sector\u2019. The BoE has also \u2018begun to build relationships with the quantum technology ecosystem, other peers and regulators, and academics working in this nascent field.\u2019<\/p>\n

The BoE has \u2018developed risk scenarios for post-quantum threats, including encrypted data harvesting and quantum-enhanced trading, and we are piloting a supervisory briefing on quantum risks.\u2019<\/p>\n

The authority will \u2018continue to build our understanding of the potential opportunities and risks posed by quantum computing for the financial sector, its implications for our objectives, our regulatory framework, and our supervisory priorities, similar to the work we have undertaken on AI\u2019; \u2018will continue to build capabilities within the PRA to enable effective engagement with firms and the sector on a post-quantum future\u2019; and \u2018will encourage upskilling within the financial system to raise awareness of the potential risks posed by quantum computing.\u2019<\/p>\n

The BoE adds that it co-chairs the G7 Cyber Expert Group (CEG) with the US Department of the Treasury, focusing on co-ordinating cybersecurity and strategy across the G7, with recent work including last month (September)\u2019s publication of a three-page\u00a0\u2018G7 Cyber Expert Group Statement on Planning for the Opportunities and Risks of Quantum Computing<\/a>\u2019; and will \u2018continue to work closely with domestic authorities and international peers\u2019, including the National Cyber Security Centre, National Quantum Computing Centre, G7, Organisation for Economic Co-operation and Development (OECD) and Switzerland-headquartered BIS.<\/p>\n","protected":false},"excerpt":{"rendered":"Bank of England: considers the three \u2018cross-cutting\u2019 technologies as having \u2018the most potential for transformative outcomes\u2019 | Credit:…\n","protected":false},"author":3,"featured_media":313146,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22],"tags":[691,157770,738,157771,157772,63129,745,3432,157773,157774,157775,118837,60,157776,33285,157777,304,14104,45691,8523,157778,157779,18749,157780,157781,157782,918,157783,157784,157785,157786,158,157787,67,132,68,157788],"class_list":{"0":"post-313145","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-computing","8":"tag-ai","9":"tag-ai-consortium","10":"tag-artificial-intelligence","11":"tag-bank-for-international-settlements","12":"tag-bank-for-international-settlements-innovation-hub","13":"tag-bank-of-england","14":"tag-computing","15":"tag-data","16":"tag-distributed-ledger-technology","17":"tag-dlt","18":"tag-dlt-innovation-challenge","19":"tag-financial-conduct-authority","20":"tag-financial-services","21":"tag-fnality","22":"tag-g7","23":"tag-g7-cyber-expert-group","24":"tag-generative-ai","25":"tag-large-language-models","26":"tag-llms","27":"tag-machine-learning","28":"tag-national-cyber-security-centre","29":"tag-national-quantum-computing-centre","30":"tag-oecd","31":"tag-project-agora","32":"tag-project-meridian","33":"tag-prudential-regulation-authority","34":"tag-quantum-computing","35":"tag-rt2","36":"tag-rtgs","37":"tag-sarah-breeden","38":"tag-supervision","39":"tag-technology","40":"tag-uk-finance","41":"tag-united-states","42":"tag-unitedstates","43":"tag-us","44":"tag-wholesale-money"},"share_on_mastodon":{"url":"","error":"Validation failed: Text character limit of 500 exceeded"},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/313145","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=313145"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/313145\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/313146"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=313145"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=313145"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=313145"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}