Bank of England to launch their own Bitcoin?

26 February 2015

bitcoin1-300x300 Bitcoin is getting taken a bit more seriously lately, and the Bank of England's (BoE) ears have pricked-up and they're looking at getting in on the action.

They reckon that digital currencies are going to become as vital and commonplace as banknotes. With that, they'll 'mint' their own version. In a paper, talking about virtual currency, they said that this money could erase the need for a third party (aka A Bank) but they're worried about the impact it'll have on the shops and that there's inevitably a need to have a central bank to regulate everything.

Of course, Bitcoin enthusiasts will be spitting their brews through their noses at the idea of The Man getting involved with their pennies. Having an authority, which people may not wholly trust, centralise the currency, pretty much goes against the enjoyment people get with the increased privacy that comes with digital currency.

"The emergence of private digital currencies (such as Bitcoin) has shown that it is possible to transfer value securely without a trusted third party," said the Bank of England in a discussion paper. However, they'd like to control the mining of money and they think someone needs to control it, to make it less volatile.

"There are several different ways in which a central bank might make use of a digital currency," the BoE said. "It could be used as a new way of undertaking interbank settlement, or it could be made available to a wider range of banks and NBFIs [non-bank financial institutions]. In principle, it might also be made available to non-financial firms and individuals generally, as banknotes are today."

If you want to read the Bank of England's paper on all of this, click here.

TOPICS:   Technology   Banking

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