Bank of England Reveals Plan to Issue RSCoin, its Own Cryptocurrency
The theoretical money shall be referred to as RSCoin. This is after the Bitcoin and cryptocurrency boom that sizzled in 2017.
This is the contrary of what other countries in Europe have in mind. Poland, in particular, has been vocal in discouraging its citizens from using Bitcoin and other virtual currencies, telling them that they are “not money”.
One of the inevitable reasons is that banks are highly regulated and controlled, whereas virtual currency is decentralized and built on peer-to-peer transactions.
However, England is clearly on the other side of the coin. Despite the fact that Bitcoin and banks do not jell well together, the Bank of England understands the potential and benefits of the Blockchain technology.
Bank Governor Mark Carney spoke with politicians in December and explained how cryptocurrency and Blockchain technology could streamline banking transactions. Thus, the Bank intends to take full advantage of these.
During the meeting, he stated:
“You (could) create a situation where you can have an instantaneous (bank) run.”
Another reason for developing the country’s own cryptocurrency is the fact that they could eliminate the other pre-existing cryptocurrency.
However, Carney also warned politicians about the drawback of having bank-issued cryptocurrency. He fears that there could possibly be risks to financial stability if the plan rolls out across the entire national economy. The Bank of England is expected to release its report on the study this year.