HM Treasury calls for information on digital currencies

Britain’s HM Treasury has launched a Call for Information (CFI) on the benefits and risks of digital currencies.

Andrea Leadsom MP and the Rt Hon George Osborne MP initiated the CFI earlier this week saying “it formed part of moves to support the growth of Britain’s emerging FinTech sector in order to ensure customers can take advantage of the latest innovations when they make payments”.

The Government is calling on the public, FinTech firms, the financial services industry, regulators and law enforcement agencies to furnish information on the benefits and risks of digital currencies.

HM Treasury said the currencies have the potential to deliver real benefits to customers in terms of speed, convenience, security and lower fees than if they were accepting payment by traditional means.

However, the department also acknowledges concerns that users of digital currencies may not be protected in the same way as when using traditional means through the regulated banking industry, opening doors that may lead to illicit or illegal activities.

The CFI follows the Chancellor’s call for a programme of work looking into the regulation of digital currencies made in August 2014.

“I want the UK to be the world leader in financial technology,” The Chancellor George Osbourne said. “That will bring jobs here and give new services to British customers.”

Economic Secretary to the Treasury, Andrea Leadsom said: “A key part of our long term economic plan is to cement Britain’s position as the centre of global finance.

“It’s only by harnessing innovations in finance, alongside our existing world class knowledge and skills in financial services, that we’ll ensure Britain’s financial sector continues to meet the diverse needs of customers here and around the globe, and create the jobs and growth we all want to see in the future.

“So it is right that we are properly consider the potential benefits, as well as the risks, that digital currencies could bring to Britain’s economy, businesses and customers.”

The Government estimates that 20 000 people in the UK currently hold Bitcoins and around GBP 60 million worth are circulating in the UK economy.

The full document can be accessed at: https://www.gov.uk/government/consultations/digital-currencies-call-for-information/digital-currencies-call-for-information#background

Our readers will recall Bitcoin gambling firm SatoshiBet exiting the U.S. market just last week citing its departure as a preemptive measure based on the uncertain future of online gambling regulation and the Bitcoin cryptocurrency (see previous report).