UK Shadow Minister for Innovation and Science, Chi Onwurah believes that digital currencies such as Bitcoin are a real opportunity for currency to be back in the hands of those who use it.
Ms Onwurah who is also the Member of Parliament for Newcastle upon Tyne Central has been leading a Labour Party review that is examining the way digital technology can improve both the effectiveness and efficiency of “people-powered” public services. The review also hopes to develop a framework for powering digital government and giving citizens control in their relationship with the government.
Ms Onwurah, who is widely touted to be included in the next Labour government, says that she would not rush into regulating Bitcoin and other digital currencies. She is of the view that there would be a need to update institutions so as to address the opportunities and challenges of the 21st century.
She however remains skeptical about the changes that digital currencies would bring about in the media and the travel sector. She sees digital currency having the ability to bring about changes in power relationships.
The shadow minister’s remarks echo those of the Chancellor of the Exchequer, George Osborne. Speaking at the moment after his first bitcoins in August 2014, Mr Osborne declared he intended to explore the potential for using digital currencies, such as Bitcoin to better the access of small business to finance. He also added that the government was exploring ways in which digital currencies such as Bitcoin would be regulated so as to boost the UK’s Financial Technology sector.
The Chancellor of the Exchequer in Britain is the equivalent of a finance minister or treasury secretary in other countries. He is considered as the second most powerful cabinet minister, being as he is directly responsible for all economic and financial matters.
The UK is determined to become the global center of financial innovation, and the government is preparing to publish a strategy document to that effect. In March 2014, the UK Exchequer announced plans for taxation on bitcoins but has so far been silent on any other form of cryptocurrency regulation. A spokesman for the Exchequer said that the goal of the government was to harness innovations in finance, and combine it with Britain’s preeminent position in finance to enable the financial sector meet the needs of business in Britain and overseas.
Bitcoin use in the UK has been off to a rocky start. In April 2014, a survey conducted revealed that 71% of the population were against the use of bitcoin. It is possible that such negative sentiment on the use of bitcoin in Britain may have to do with poor awareness on the nature of bitcoin and other digital currencies. In addition, the banks in the UK have also been lukewarm in their approach to bitcoin. Many bitcoin startups have seen banks refusing to open accounts for them in the UK. Banks in the UK have been taking advantage of AML laws and the lack of regulation on digital currencies to lock out bitcoin in the UK financial system. With more and more UK politicians coming out strongly in favor of the use of digital currencies, a tipping point may be reached that will shuttle digital currencies to the heart of the UK financial system.
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Images from Chi Onwurah MP Website and Shutterstock.