Bitcoin gets a central bank rival as academics develop cryptocurrency RSCoin, but might pounds and pence need to watch their back as well?
Currency as we know it might be about to be shaken up, as academics from University College London have published a paper on a cryptocurrency which could be used by central banks.
Unlike bitcoin and its contemporaries to date, the framework for RSCoin can be centralised and maintain by a State's central bank.
The paper by George Danezis and Sarah Meiklejohn concludes: "By constructing a blockchain-based [the technology that underpins bitcoin] approach that makes relatively minimal alterations to the design of successful cryptocurrencies such as bitcoin, we have demonstrated that this centralisation can be achieved while still maintaining the transparency guarantees that have made (fully) decentralised cryptocurrencies so attractive."
In a speech given at the London School of Economics earlier this month, Ben Broadbent, deputy governor for monetary policy at the Bank of England, remarked that he thought bitcoins were unlikely to become an alternative unit of measure, but, rather, it was the distributed ledger behind them that made them interesting.
A study released earlier this month by FTI Consulting found that UK financial institutions were far more clued up about blockchain and cryptocurrencies than their overseas counterparts, with over a third (35 per cent) of those in the UK stating they had prior knowledge of blockchain.