Digital Currency Weekly Recap 10-11-2015
RBS Experiments with In-House Digital Currency
Even as many large banks are actively resisting the digital currency revolution, some – like the Royal Bank of Scotland (RBS) – are embracing it in unexpected ways. According to RBS subsidiary NatWest’s head of technology, Neil Bellamy, the bank has recently been working with outside cryptocurrency firms and has created its own digital currency that is being traded and settled between RBS’ various banks.
The experiment is part of the banking giant’s broader strategy of embracing innovation by working with innovators, rather than viewing new technologies as threats. As part of that strategy, RBS has been operating innovation centers where businesses that create financial technology are able to test their products in an environment that is designed to simulate the real marketplace. That’s allowed the bank to test a variety of mobile pay systems and other financial innovations, as well as distributed ledger technologies.
According to Bellamy, NatBank and RBS as a whole view these new innovations as opportunities to better serve their customers. At the same time, the RBS strategy of working with tech innovators rather than just co-opting their technologies is a boon to the nascent industry as well.
Interpol, Europol Unite in Response to Fears of Digital Currency Crime
In another sign of international law enforcement’s ongoing fixation with digital currency’s potential for facilitating criminal activity, Europol has joined with Interpol to focus on crypto-crime. The new partnership is being hailed by the European organization as a coordinated effort to deal with cryptocurrency money laundering and other criminal use of digital currencies. The two groups have apparently invited other organizations to join them in their efforts.
Just last month, Europol had issued a threat assessment on organized internet crime in which it identified digital currency as accounting for roughly 40% of all online criminal transactions. That report followed months of Interpol experimentation with its own digital currency, which it created as a way to study the technology and conduct cryptocurrency crime simulations for training purposes.
This latest partnership is seen by law enforcement as an opportunity to develop more coherent policies and training methodologies to more effectively identify and address criminal acts that utilize digital currency. The intent is to focus on better detection of these crimes, while developing effective policies for seizing assets derived from such illicit activities.
All Eyes on DNotes As It Announces New Company Debuting in 2016
Alan Yong and DNotes generated news in the industry this week as the bitcoin alternative announced its plans for 2016. Those plans, which include the launch of a new company designed to better integrate the digital currency and the blockchain with a new and more efficient payment system, were widely seen as yet another positive step in the development of DNotes’ innovative cryptocurrency ecosystem. According to reports, the new company will be a for-profit endeavor that will see DNotes maintaining roughly 25% ownership interest as it seeks to further enhance the stability and future growth of its currency.
Industry visionary Yong also revealed many of his thoughts on the state of the industry, its current challenges, and the opportunities that lie ahead. Identifying the current inability to gain mass acceptance as the single greatest industry challenge at this time, Yong noted the importance of ensuring that DNotes can fulfill each of the primary functions demanded of all currency: “as a unit of account, as a medium of exchange, and as a store of value.”
As Yong reminded everyone, the goal is to continue the effort to shepherd digital currency into the mainstream of the world economy, where it can provide greater economic access and benefits to people everywhere. As DNotes continues to expand its own ecosystem with moves such as this, that goal of mainstream acceptance appears to be growing more attainable with each passing day.