British government starts taking bitcoin seriously

Buried in the Chancellor’s budget breakdown were some compelling references to the future of digital currencies in the UK.

In a document released by the Treasury, the government summarised its findings from an open call for information run in November to gather information from the business world on the uses and potential of bitcoin and other virtual currencies.

According to the document, the survey highlighted a broad range of ways that that digital currencies, used as a method of payment, could offer to consumers, businesses, charities and the wider economy. However, the responses also suggested that, as they currently stand, these also have “ inherent flaws which make them volatile and potentially unsuitable for mainstream usage” and many fear that they could be “an enabler of crime”.

More interesting to the Treasury, it seems, is the blockchain technology that powers bitcoin.

“While there are clear barriers to digital currencies achieving widespread use in their current form, the ‘distributed ledger’ technology that underpins digital currencies has significant future promise as an innovation in payments technology,” said the report.

The government says that it now plans to focus on supporting research, minimising opportunities for criminal activity and creating “the right environment for legitimate digital currency entrepreneurs to flourish”.