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Offline mike623317

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Home Office: UK Should Create a Cryptocurrency
« on: June 24, 2015, 10:35:12 PM »

Home Office: UK Should Create a Crime-Fighting Cryptocurrency

http://www.coindesk.com/home-office-uk-should-create-crime-fighting-cryptocurrency/

The UK Home Office believes the government should consider creating its own digital currency that limits anonymity and increases the traceability of transactions.

In a response to the Treasury’s call for information on digital currency, the Home Office highlighted both the positives and negatives of existing digital currencies, such as bitcoin.

The government department, which is responsible for immigration, counter-terrorism, police and drugs policy, recognised the low cost of transactions and increased speed of payments provided by digital currencies.

However, the document, which was obtained by CoinDesk via a freedom of information request, also highlights some of the associated downsides, such as the fact cryptocurrency affords a degree of anonymity to criminals.

With this in mind, the Home Office said in its submission: “We believe that there might be a number of advantages of any digital currency for the UK being created and owned by central government.”
Restrictions

It goes on to say one major advantage of government-created digital currency is that it could be designed to limit use for criminal and terrorist purposes.

“In particular, a digital currency owned by the UK government would be controlled by a central body ... It could also be pegged to a fiat currency, to reduce potential fluctuations in its value,” the submission continues.

The response suggests a government-issued digital currency should be designed in such a way that its ownership and use can be traced, enabling law enforcement agencies to identify whether it has been used for criminal or terrorist purposes and who by. It continued:

    “Access to such information would need to be restricted, but would be of use to law enforcement agency investigations and anti money laundering work. It would also have the additional benefit of acting as a deterrent to criminal use, as criminals would be unlikely to want to use a currency that it is traceable.”

Regulation should also require that any digital currency involved in criminal activity can be seized by the authorities, the department’s response states.
Preventing fraud

The Home Office highlights that, as bitcoin transactions are irreversible, fraudulent payments can be made without recourse.

It suggests a government-created cryptocurrency should be designed in such a way that fraudulent transactions can be reversed.

“It would make sense to identify how fraudulent transactions can be unwound and the digital currency reimbursed to the legitimate owner,” the submission states.

However, it does not mention that the irreversibility of transactions is seen, by some, as a positive feature of bitcoin. Many merchants favour this feature as it means they are not subject to fraudulent chargebacks.

Exchange licensing

According to the Home Office, cryptocurrency exchanges should be licensed, with their licenses withdrawn if they fail to meet certain requirements, such as the monitoring of transactions and reporting suspicious activity to the National Crime Agency.

The department suggests digital currency companies, such as wallet providers and exchanges, should be required to carry out the relevant anti money laundering and know-your-customer checks on its users.

Essentially this would mean digital currency exchanges face the same requirements as other financial institutions.

In order to ensure the success of regulation created in the UK, however, the Home Office claims international cooperation is “essential”. The response states:

    “The conversion point where fiat currency becomes digital, and vice versa, is hard to oversee, given digital currencies have global reach. Without global consistency in approach, oversight and security is difficult.”

Similar themes

The Home Office response offered some similar recommendations to the response submitted by Citi’s Treasury and Trade Services Technology and Innovation Team. Citi also suggested the Treasury should consider creating its own digital currency.

The response from MasterCard, on the other hand, emphasised the risks associated with cryptocurrencies and stated that currencies such as bitcoin don’t have many, if any, strong benefits.

Another company to submit a response was Accenture, which suggested the UK government should consider regulating bitcoin wallets and apply the same identification requirements to wallet providers as it does to banks.
Action taken

Little action has been taken by the Treasury since it received responses to its call for information. In March, it published a report, stating plans to apply anti-money laundering regulations to digital currency exchanges.

The report said the Treasury will also hold a "full consultation" on the topic of cryptocurrencies and revealed that £10m had been earmarked for research into digital currency technology.

Offline Permie

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #1 on: June 24, 2015, 10:43:43 PM »
Good luck maintaining a peg.
Hopefully they bankrupt themselves.
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Offline Ander

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #2 on: June 24, 2015, 10:58:56 PM »
Quote
The response from MasterCard, on the other hand, emphasised the risks associated with cryptocurrencies and stated that currencies such as bitcoin don’t have many, if any, strong benefits.

Mastercard: "Our competitors are scams/shitcoins!"

-Just like every tribe in cryptoland.
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Offline Ben Mason

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #3 on: June 24, 2015, 11:40:03 PM »
Um this is some funny stuff. The biggest criminals on earth are worried about other criminals.  They are clinging to the past. They can't  see where all this innovation could lead because they lack imagination and their agenda is unbelievably narrow in scope. Projects like Bitshares are potentially global, autonomous, highly resilient constitutions.

Offline Permie

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #4 on: June 25, 2015, 10:59:39 AM »
They are clinging to the past. They can't  see where all this innovation could lead because they lack imagination and their agenda is unbelievably narrow in scope.
I don't think governments are stupid, they know exactly what it is that they're stifling.

The message that this or that party is 'incompetent' just hides the malice

Quote
Projects like Bitshares are potentially global, autonomous, highly resilient constitutions.
Bts to the rescue! Hopefully soon
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Offline bitmeat

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #5 on: June 25, 2015, 11:39:02 AM »
Good luck maintaining a peg.
Hopefully they bankrupt themselves.

Maintaining a peg is super easy. Any central bank can provide a DPOS system that will work. Then when they print their next $1B worth, they can issue it on a blockchain instead. In fact I expect Central Banks to use a distributed ledger in the near future. This will also make Bitcoin and all other cryptos mostly obsolete.

Offline Ben Mason

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #6 on: June 25, 2015, 11:52:29 AM »
Good luck maintaining a peg.
Hopefully they bankrupt themselves.

Maintaining a peg is super easy. Any central bank can provide a DPOS system that will work. Then when they print their next $1B worth, they can issue it on a blockchain instead. In fact I expect Central Banks to use a distributed ledger in the near future. This will also make Bitcoin and all other cryptos mostly obsolete.
why would other crypto become obsolete?  Surely, it is the corruption resistant protocol & open source code that has the most compelling case for a network people can trust.  Central banks are not well regarded and that trend is set to increase exponentially along with hyperinflation.....

Offline Permie

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #7 on: June 25, 2015, 12:03:40 PM »
Good luck maintaining a peg.
Hopefully they bankrupt themselves.

Maintaining a peg is super easy. Any central bank can provide a DPOS system that will work. Then when they print their next $1B worth, they can issue it on a blockchain instead. In fact I expect Central Banks to use a distributed ledger in the near future. This will also make Bitcoin and all other cryptos mostly obsolete.
I neglected to consider that this would be a like-for-like peg, not USD to EUR for example - oopsie.

If they issue it as fiat then I wouldn't be too worried. Printing money is printing money - it will come back to bite them later anyway.

But what if they issued scarce money but kept control over monitoring it.
Would it still be the sound money that the world sorely needs?
Good luck maintaining a peg.
Hopefully they bankrupt themselves.

Maintaining a peg is super easy. Any central bank can provide a DPOS system that will work. Then when they print their next $1B worth, they can issue it on a blockchain instead. In fact I expect Central Banks to use a distributed ledger in the near future. This will also make Bitcoin and all other cryptos mostly obsolete.
why would other crypto become obsolete?  Surely, it is the corruption resistant protocol & open source code that has the most compelling case for a network people can trust.  Central banks are not well regarded and that trend is set to increase exponentially along with hyperinflation.....
I agree that is the most compelling case for those of us who have some idea what it going on, but hardly anybody does.
BUT I'VE GOT NOTHING TO HIDE SO I DON'T CARE LALALALALALALA
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Offline bitmeat

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #8 on: June 25, 2015, 12:39:52 PM »
Maintaining a peg is super easy. Any central bank can provide a DPOS system that will work. Then when they print their next $1B worth, they can issue it on a blockchain instead. In fact I expect Central Banks to use a distributed ledger in the near future. This will also make Bitcoin and all other cryptos mostly obsolete.
why would other crypto become obsolete?  Surely, it is the corruption resistant protocol & open source code that has the most compelling case for a network people can trust.  Central banks are not well regarded and that trend is set to increase exponentially along with hyperinflation.....

Again - if USD, GBP start having features similar to BTC, without the regulation/taxation burden, businesses will start adopting the technology.

You don't have to sell the idea of corruption resistance to anyone in the space. But the average Joe will go with the path of least resistance.

So they will achieve internet of things with a centralized currency. Look at Gold - there is nothing preventing you today from using Gold as a currency. But it is just too much hassle to do so. It's the same with BTC and altcoins.

EDIT: did some digging. Unless you are doing it wrong. Like this guy: http://gata.org/node/7696
« Last Edit: June 25, 2015, 12:44:17 PM by bitmeat »

Offline Empirical1.2

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #9 on: June 25, 2015, 12:57:21 PM »
Maintaining a peg is super easy. Any central bank can provide a DPOS system that will work. Then when they print their next $1B worth, they can issue it on a blockchain instead. In fact I expect Central Banks to use a distributed ledger in the near future. This will also make Bitcoin and all other cryptos mostly obsolete.
why would other crypto become obsolete?  Surely, it is the corruption resistant protocol & open source code that has the most compelling case for a network people can trust.  Central banks are not well regarded and that trend is set to increase exponentially along with hyperinflation.....

Again - if USD, GBP start having features similar to BTC, without the regulation/taxation burden, businesses will start adopting the technology.

You don't have to sell the idea of corruption resistance to anyone in the space. But the average Joe will go with the path of least resistance.

So they will achieve internet of things with a centralized currency. Look at Gold - there is nothing preventing you today from using Gold as a currency. But it is just too much hassle to do so. It's the same with BTC and altcoins.

The major currencies of the world are in a race to the bottom. When the current financial system fails, faith in government issued currencies will evaporate, whether they're based on a blockchain or not. The world will want gold and silver as well as a handful of the most established & immutable crypto-currencies.




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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #10 on: June 25, 2015, 01:07:33 PM »
The major currencies of the world are in a race to the bottom. When the current financial system fails, faith in government issued currencies will evaporate, whether they're based on a blockchain or not. The world will want gold and silver as well as a handful of the most established & immutable crypto-currencies.

Yep. Throughout history people have clamored to get into the "black market" currency once faith is lost in their government issued currency.

Offline sschechter

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #11 on: June 25, 2015, 03:04:22 PM »

So they will achieve internet of things with a centralized currency. Look at Gold - there is nothing preventing you today from using Gold as a currency. But it is just too much hassle to do so. It's the same with BTC and altcoins.

EDIT: did some digging. Unless you are doing it wrong. Like this guy: http://gata.org/node/7696

Actually theres this http://www.dgcmagazine.com/peter-schiffs-euro-pac-bank-introduces-a-silver-backed-debit-card/
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Offline hadrian

Re: Home Office: UK Should Create a Cryptocurrency
« Reply #12 on: June 25, 2015, 09:02:19 PM »
So should we attempt to get the UK to create a User Issued Asset on BitShares? :P
A whole nation state's cryptocurrency as a BitShares UIA!!!
I believe, because our platform is so flexible, can give them the features they require...

In particular, a digital currency owned by the UK government would be controlled by a central body ...
Yep - the issuer can retain control

The response suggests a government-issued digital currency should be designed in such a way that its ownership and use can be traced, enabling law enforcement agencies to identify whether it has been used for criminal or terrorist purposes and who by.
Yeah - whitelisting could be useful here

Regulation should also require that any digital currency involved in criminal activity can be seized by the authorities, the department’s response states.
Aye! The issuer of an asset can do this.

It suggests a government-created cryptocurrency should be designed in such a way that fraudulent transactions can be reversed.
Yes, I think this can be done too.

N.B. to any reading this who are unfamiliar with BitShares - it is also possible to create assets on BitShares which CANNOT do these things, so don't worry if you don't like any of these features!

edit: Nobody needs to point out that this would never happen by the way
« Last Edit: June 25, 2015, 09:05:24 PM by hadrian »
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Offline Permie

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Re: Home Office: UK Should Create a Cryptocurrency
« Reply #13 on: June 25, 2015, 09:29:27 PM »
Never say never. Who knows what's going to happen.
Or rather, what we as a community can make happen!
BitShares really can provide all of these features, give them the authority and control they want and all for zero infrastructure investment and be orders of magnitude cheaper to run due to decreased fraud and theft.

There's a tv show in the UK running now called 'The Bank: A matter of life and debt" that features NatWest (UK consumer bank) and shows how theyre supposedly 'all about the customer' now. It shows bank managers talk to very disgruntled customers who complain about slow cheque clearance, poor negotiation of loans and about the need to come into branch at inconvenient times. These bank customers were still vocally upset about the financial crisis of 2008 and a very anti-bank sentiment.

We should tell these angry tax payers of a way that their government (don't tell them to do anything for themselves!) could solve a lot of these problems and it wouldn't cost them any taxpayer money
That should be the focus. It will save the taxpayers money

I seriously think this could be possible if the mainstream media would ever report it.

http://www.theguardian.com/tv-and-radio/2015/jun/24/the-bank-a-matter-of-life-and-debt-review
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Offline hadrian

Re: Home Office: UK Should Create a Cryptocurrency
« Reply #14 on: June 25, 2015, 09:45:17 PM »
There's a tv show in the UK running now called 'The Bank: A matter of life and debt"

Cheers Permie, I'm gonna watch that on iPlayer.   :)
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