Saturday, June 20, 2015
FinTech Digest: Emojis Replace Pin Codes, Bond Street Raises $110M, and Future of FinTech Is in Asia and Africa
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Friday, June 19, 2015
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Commentary: Bitcoin Adoption in the United Kingdom
This is a guest post by George Basiladze of Cryptopay.me.
Following mentions of U.K. chancellor George Osborne’s desire to make Britain a Bitcoin Capital last year and proposing a government investigation into the potential of the cryptocurrency and related technology, 2015 would appear to be an exciting time for Bitcoin in the United Kingdom
The “call for information” report issued by the last government in March was deceptively positive, despite a clear depiction of the regulatory minefield which must be navigated before Bitcoin can play a more significant part in U.K. business life.
It also appears that much interest is being directed toward the blockchain technology that informs Bitcoin from leading financial powers, many of which are based within the city of London. More interesting, though, is the gradual adoption by more and more members of the British public.
CEX is a chain of secondhand technology stores and a regular fixture on many British high streets. It is one of the more significant U.K. retailers that accepts payment in bitcoin; the nature of the retail outlets’ focus on technology means it has access to a massive cross-section of the current and potential cryptocurrency user base. Early adopters such as CEX serve the wider Bitcoin community by providing greater visibility to the cryptocurrency and leading by example in its faith in the alternative currency.
A significant difficulty remaining with U.K. Bitcoin adoption is existing financial authorities, namely the big British banks, who are ever reluctant to work with a Bitcoin-based enterprise. This means many Bitcoin businesses aimed at the British market are based elsewhere in Europe, resulting in U.K. customers facing two- or three-day delays when transferring fiat currencies to Bitcoin businesses as they must use SEPA transfers to European bank accounts.
Perhaps the government interest in cryptocurrencies will lead to renewed faith within British banks toward Bitcoin, and eventually Bitcoin businesses will be able to do their fiat banking at home. This would be an important step toward enabling cryptocurrency-based enterprise to become a significant player in the future U.K. economy.
The map provided by wheretospendbitcoins.co.uk shows a reasonably consistent spattering of Bitcoin-friendly businesses across Great Britain, with a great deal centered on the capital. The profile of a business that accepts bitcoin payments is surprisingly diverse, with everyone from trendy foodie bars such as La Porca in Camden to Sushi cooking school YourSushi, which has sites in a number of British cities, getting involved in the cryptocurrency.
Only time will tell if Bitcoin can overcome the almost novel, speculative light in which many see it, but it is the visibility of the currency across public life that ultimately has the greatest power to influence greater use. Policymakers have a responsibility to ensure the public has the protection and right to access the incredible potential of cryptocurrencies.
Entrepreneurialism is rife within the Bitcoin community and drives the currency forward; it is now possible to purchase almost any goods with bitcoin through the ingenuity of services such as giftoff.com which enables users to purchase a huge variety of gift cards for stores including Apple and Amazon using bitcoin and a range of alternative cryptocurrency.
Hopefully, development and adoption of Bitcoin will continue both within the U.K. and further afield across the rest of 2015, and perhaps 2016 will be the year that we can pay our rent and tax obligations using bitcoin, helping to push the international community to move toward accepting the legitimacy of the alternative currency.
There are still obstacles to overcome for Bitcoin, with headaches regarding the future of the block size causing issues for developers around the world working on the Bitcoin project; however, as always, it is an exceptionally exciting time to be involved with the cryptocurrency community.
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36% of Australians Would Trade Banks for Better Digital Money Services
A recent survey conducted by personal finance company Fair Go Finance has found that a large chunk of Australians are ready to leave the traditional banking system and move to digital money. The survey received responses from 3,148 people, and the questions involved everything from bitcoin to Facebook money transfers.
The online survey was conducted in April 2015.
34% know about bitcoin
Thirty-four percent of Australians who responded to the survey claimed they know something about bitcoin. Of course, the level of understanding of bitcoin is likely to vary from person to person. The question was phrased as, “Do you know anything about Bitcoins?” which means many respondents who had simply heard of bitcoin as some sort of PayPal alternative would have likely responded in the affirmative. Some of these respondents may have trouble attempting to explain the complexities of the blockchain.
There was a bit of divergence in the responses from men and women in this initial question about bitcoin. While 43 percent of male respondents claimed to know about bitcoin, only 28 perecent of women did. There was less of a divergence in the responses from Generation X and Y. In fact, the numbers from those age groups were practically identical.
Among the Australian population, 51 percent of respondents claimed they do their digital money research on their own. Twenty-six percent said they get their information from friends and family, and 13 percent said they learn about digital money from their current bank or finance provider. Only 2 percent of respondents claimed they are not interested in digital money or financial technology.
It’s all about convenience
When it comes to the reasons behind Australia’s thirst for digital money, convenience is king. Seventy percent of respondents claimed that convenience and the ability to use digital money 24/7 are the best features of the financial technology. Twelve percent of respondents find digital money to be safer than carrying cash, while 15 percent claimed it helps them be more in control of their finances. Two percent of respondents find digital money to be too risky.
Although this survey was about more than bitcoin, it should be noted that the digital commodity still has plenty of work to do in the convenience department. Price volatility and an inability for the average person to understand the technology are still key barriers to mainstream adoption.
Australia’s desire for convenience was also seen in a question related to how digital money is used in the real world. Forty-eight percent of respondents said they would like to replace PIN codes with biometrics by 2020. Only 18 percent claim they would not use biometrics, with the rest undecided.
36% want digital money, but not from Facebook
Perhaps the most interesting finding is that 36 percent of respondents claimed that they would change banks for better digital money services. Thirty-five percent claimed they would not change banks in order to access better financial technology, while 29 percent were unsure.
Although Australians are ready to gain access to better digital money services, it appears that transferring money via Facebook is not in the cards for most. Sixty-nine percent of respondents say they would not use the social media platform to send money to family and friends, and only 11 percent seem ready to use Facebook for payments right now.
Canadian Senate Says No to Regulating Digital Currencies
The Canadian Senate’s Banking, Trade and Commerce (BTC) committee released its final report Friday asking the federal government to use a “light touch” in dealing with digital currencies.
“We’ve heard, and we agree, that blockchain technology is at a delicate stage in its development and use,” the report reads. “This is why we urge the Government to explore the vast potential of this technology, while treading carefully when contemplating regulations that may restrict and stifle its use and development.”
This is cause for relief among the country’s Bitcoin community and makes Canada one of the world’s most forward-looking countries in encouraging innovation in new financial technologies.
The Bitcoin Community Reacts
Senators praised the many witnesses from the Bitcoin community who came forward to testify calling them “passionate and optimistic.”
Witness Victoria van Eyk, now head of community outreach for ChangeTip, was not surprised at the report’s recommendations.
“The senators we talked to were very wary of more regulations and expressed concern about the effect of regulations on stifling innovation,” said van Eyk.
“The committee made it clear to us that they wanted nothing to stand in the way of Canada becoming a world leader in developing new financial technologies.”
Victoria van Eyk demonstrates a Bitcoin ATM for members of the Canadian Senate (Photo courtesy of the Senate of Canada)
“The conclusions of the Senate Banking Report on digital currencies are extremely positive for all Canadians,” Bitcoin community leader Anthony Di Iorio, President of Decentral Consulting and co-founder of the Ethereum Project told Bitcoin Magazine. “Recommendations from the committee that the government explore the vast potential bitcoin and blockchain technology while cautioning against regulations that might hinder its growth and potential have the great opportunity to solidify Canada as a leader in the digital currency and cryptocurrency space.”
“This will go down as a defining moment in the history of Bitcoin in Canada,” said Kyle Kemper, executive director of the Bitcoin Alliance of Canada. “This report represents the most thorough and well-balanced study of a technology that stands to be as impactful as the Internet.”
Canada’s Cautious Approach to Regulating Digital Currencies
As mentioned in an earlier Bitcoin Magazine article, Canada’s federal government has taken a cautious approach to regulating digital currencies, and was waiting to see what the Senate would recommend.
Because it’s an election year, the government’s attention is elsewhere and the senators did not expect the government to respond until after the fall vote.
“This is in line with Bill C-31… which would see ‘dealers in digital currency’ regulated as money services businesses,” Amber Scott founder and CEO of Outlier Solutions noted. “This type of approach is intended to foster innovation while protecting both Canada and consumers from threats posed by money laundering, terrorist financing and other illegal activities. I’m in full agreement that regulation must be balanced. The possibilities that are opened up by technology innovation are much more exciting than the risk.”
Expert witnesses who appeared throughout the 18-month study included:
Andreas Antonopoulos
Digital Finance Institute
Bill and Melinda Gates Foundation
Ripple Labs
BitPay
The Bitcoin Foundation of Canada
The Bitcoin Embassy
And many more.
The full report, called Digital Currency: You Can’t Flip This Coin!, is available online.
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