The Bank of England has published policy papers on central bank digital currency (CBDC), specifically on the digital pound in the United Kingdom. These papers discuss the need for a digital pound, its design features, and its potential use by consumers and businesses. The concept of a CBDC is defined as an electronic form of central bank money that can be used for payments and storing value. Many central banks around the world are researching CBDCs, with some already launching their own. In the UK, the Bank of England and HM Treasury have expressed that a digital pound may be needed in the future to maintain public access to retail central bank money and to promote innovation, choice, and efficiency in domestic payments. This article focuses on the potential relationship between the digital pound and innovation.