Reports

‘The Digital Currency Revolution’

A new report from the Centre for the Study of Financial Innovation (CSFI) by David Birch

Download the report here

Like others, the CSFI is going virtual for the duration of the coronavirus lockdown; But we have a couple of reports ready to go – and the current unpleasantness shouldn’t affect their relevance.

The first is a paper by David GW Birch – co-founder of Consult Hyperion (one of the UK’s leading fintech consultancies), a visiting professor at the University of Surrey and a prolific author, most recently of Before Babylon, Beyond Bitcoin (a polymathic excursion through the history of currencies). He is (and has been for a long time) a committed advocate for the abolition of cash, and for a transition to digital currencies – whether they be state-issued fiat currencies or competing private currencies. In this report, he looks at what the Bank of England is saying and what the PBoC is doing – and he concludes that we risk being left behind.

That said, he gives great credit to the former Governor of the BoE, Mark Carney, who (he feels) was well ahead of the curve – at least as far as central bankers were concerned. As he puts it:

‘When people such as Mark Carney start talking about synthetic hegemonic currencies, we must conclude that something is afoot. I think that people underestimate the impact of digital currency – and look at innovation by Facebook when they should be looking at the People’s Bank of China.’

(The innovation by Facebook is, obviously, Libra – or, as Dave calls it, ‘Facebucks’.)

This paper sets out what a digital currency is (and how it differs from cryptocurrency), explains why there is a focus on digital currency right now, and explores the implications of the launch of digital currencies – whether by Bitcoin entrepreneurs or by the Fed. It ends with a call for a co-ordinated strategic response based on innovative policies on digital money, digital identity and digital diligence.

Tomorrow morning the CSFI will publish a video debate with Dave Birch that addresses many of the topics covered in this report. Keep an eye on our Twitter, Youtube, and Instagram pages for more information.

For more information, please contact: Dave Birch: [email protected] or Andrew Hilton: [email protected]

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