Great Britain made an epic mistake about 150 years ago. When the United Kingdom, not Germany, not the United States, was the original home of the automobile’s innovation. This is not well-publicized in Western culture because of the epic failure in the story, and how swiftly the U.K. acted in its own demise. Instead of welcoming the automobile as a technological marvel that’ll not only provide freedom of travel to the masses someday, but also a massive industry they could cultivate domestically, they shunned the automobile. Instead of a technological advancement, British regulators saw the automobile as rolling machines of death to be feared and legislated out of the country altogether through the “Red Flag Laws”, or “Locomotive Acts” of the 19th century.
This level of onerous legislation did not kill the newest instrument in travel technology, in fact quite the opposite. Their disdain pushed its growth to Germany and “across the pond” to the U.S., where the automobile concept took hold and created industries that are cornerstones of those countries to this very day. Bitcoin’s innovative nature has suffered a similar fate in many jurisdictions worldwide.
Has the United Kingdom learned its lesson from that incredibly fearful miscalculation? It appears so, as they will not let the technology of Bitcoin and it’s ability to change the economic world forever pass them by through slough, ignorance, or fear. This time Britain looks to become the beneficiary of the revolutionary castoffs of other nations’ regulators. One nation’s famine is another nation’s feast. London, England has designs on being the global domain of Bitcoin’s future growth.
Why London? Why Bitcoin?
New York can claim the global leadership of the current, dying financial system with the New York Stock Exchange and NASDAQ. Silicon Valley and the Bay Area in California can claim true leadership in computing and technological innovation. London sees an opportunity for the digital currency to be the next major wave of growth for the 21st century, and regulators seem eager to capture it without killing the innovative nature of it in the process.
London is already home to CoinScrum, the world’s largest bitcoin networking and meetup group, with well over two thousand active members. Last month, British regulators announced they will create plans to prevent money-laundering and other illegal practices at Bitcoin exchanges while crafting standards for the industry as a whole. And with New York’s infamous BitLicense debacle, London is becoming much more attractive to Bitcoin businesses as a major international city that is actually safe to call home.
“What we see in the UK … is a different attitude,” said Jerry Brito, executive director of Coin Center, told Reuters. “It’s a very positive attitude, one of: this is an amazing innovation, we’re going to have to have some regulation in terms of money laundering, but let’s do this in a constructive way, in partnership with the technologists and the industry.”
Some places, ok, many places around the world see the Bitcoin glass as half empty, looking at every possible thing that could go wrong in its future. London is no “Negative Nelly” when it comes to digital currency. They look at all it can do to build businesses and jobs, especially in a generally weak economy at present. Britain can always use an innovative technological engine for economic growth. Maybe no city in the world has the extensive history of economic stewardship that London does, and British Finance Minister George Osborne wants to push that envelope. He has already stated that he wants London to be a financial technology leader, and digital currency is a major part of their future.
“London has been the home of financial innovation for hundreds of years,” said Nicolas Cary, co-founder of Blockchain, which provides bitcoin data and “wallet” software for storing the currency. “It would be a historical mistake not to make this the home of digital currencies. There’s an incredible amount of talent and experience here.”
Under this new attitude and initiative towards crypto-currencies, Britain made bitcoin trading exempt from value-added tax last year. However, Australia has made bitcoin transactions subject to goods and services tax. That helped to drive CoinJar, an Australian company that allows users to buy, sell and spend bitcoins, to move its headquarters to London last December.
And as we’ve reported, UBS will create a will open a Bitcoin “technology lab” in London to explore the wider application of the technology in the financial services industry. On top of that, the British government has promised 10 million pounds ($15 million) for a research initiative that will look into the block chain technology behind digital currencies.
It is refreshing to see one established leader is stepping into the future of economic innovation with aplomb. Some instead shudder in fear by creating a ban on Bitcoin (Russia), or are merely looking to line their own pockets up front (Australia & New Jersey).
London may be missed the bus when it came to the internal combustion engine, but they are cashing in on Bitcoin’s future with impeccable timing. They have a long-term plan with Bitcoin that doesn’t look to leverage Bitcoin for a short-term gain, but build an incubator for economic growth that may power them throughout the 21st-century. No wonder they’ve been a financial leader for centuries. Many governments could learn a thing or two from their thoughtful approach to digital currency and the technologies within.
Images provided by Shutterstock.
Where would you start a Bitcoin business and why? Do you think the U.K. sees the Euro’s days as numbered, and is hedging their bets with digital currency? Share above and comment below.