Mark Carney, the governor of the Bank of England, has revealed that he is open minded on the prospect of a U.K. cryptocurrency to rival the ubiquitous Bitcoin. Daily Express reported that the Central banker explained during the Riksbank Anniversary Conference on Tuesday in Sweden that the future of banking lies within the Central Banking Digital Currency (CBDC).
He said that:
“…The potential of central banking may involve fewer central bankers.”
The statement was a pointer to the governor’s position that the Bank of England may be considering the prospect of a central lender digital forex. Carney’s view at the said event is backtracking from his prior position. He had, initially, stated that cryptocurrencies had “pretty much failed thus far, on the traditional aspects of money.”
The bank governor had ruled out Bitcoin and claimed that it “is not a store of value because it is all over the map” and “nobody uses it as a medium of exchange.” So, with the change in tune, could the governor be insinuating on the prospect of Britcoin in the U.K. as the cryptocurrency of choice?
The Inspiration Behind Britcoin
Launched on June 27, 2014, the founders of Britcoin believed that it would address current issues while also maintaining “true British ethics and values in mind.” The founders worked with an assumption that a digital currency distributed to a large population within a small geographical area will receive a higher penetration than a global cryptocurrency.
Could Britcoin be exceptional?
The concept is not new. Trials have taken place in Spain, Iceland, and Israel. However, none of these countries have provided a success story on the same.
Notably, Iceland’s Auroracoin was the most publicized of all the national cryptocurrencies mentioned. The launch of the cryptocurrency in February 2014, during the country’s financial revolution, was noble. At one time, it became the fourth most valued cryptocurrency. However, it has since plummeted in value; therefore, hard to draw any inspiration from.
Scotland has also come up with a cryptocurrency called the Scotcoin. After the 2014 independence referendum, there were calls for the development of a cryptocurrency to be used in Scotland as a means of avoiding overreliance on the pound. Scotcoin co-owner, David Low, has already offered the altcoin to the Scottish government to make it the official cryptocurrency.
In a speech on March 01, 2018, Carney called for regulation of Scotcoin and other cryptocurrencies to combat crime. He further argued that digital currencies are highly volatile and investing in them is risky. In his address at the Scottish Economics Conference, he stated:
“The time has come to hold the crypto-asset ecosystem to the same standards as the rest of the financial system.”
The U.K. has never taken a decisive and firm position on cryptocurrencies. Despite calls by Carney for regulation, the governor has come out openly to assert that the Bank of England has an “open mind” about the eventual development of a central bank digital currency in the future.
The about-turn by the Bank of England governor on cryptocurrency leaves many cryptocurrency enthusiasts and pessimists guessing. Is he going to go the Scottish way and let Britcoin be the currency of choice?
All we can do is to wait, guess and speculate.