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Bitcoin to GBP

London is to the European Union as Manhattan is to the United States. Britain’s exit from the European Union (Brexit) in 2016 has caused havoc in the fintech industry (at least in Europe).

One big advantage of being a part of the EU is the ability to passport a financial license. That means when you get a license for financial services in one country, you are able to passport this license to other countries.

You do not have to spend money on applications and bonds for each country, learning the languages of all the different member states and then waiting to go through the slow bureaucratic application process for each country.

Now that UK is looking to leave the EU, the passporting benefits of the licenses will change. Needless to say, this is incredibly important for the startups in the Bitcoin and blockchain industries when choosing a headquarters within Europe.

It is safe to say Brexit will have harsh implications on Britain’s economy. Fintech companies in the UK are already contemplating the future in Post-Brexit Britain as they may lose unhindered access to other EU nations, which they have been enjoying until now.

The European Union is doing its best to make it easier for the fintech companies to operate in the region. It recently announced lower regulatory requirements and EU passporting benefits to the companies operating in the sector.

According to a Financial Times story, big banks plan to create a new standard to clear and settle financial trades using blockchain. This means Blockchain could make a significant difference to the outcome of Brexit for the U.K. economy, at least for one of the most important sectors: banking.

The UK’s working class triggered Brexit, but it is London where the changes are going to be felt first and hardest. It has caused Bitcoin and blockchain companies to rethink their European strategy.

Bitcoin in United Kingdom

It wasn’t long ago when United Kingdom was being considered a Bitcoin paradise. The island was showing all the signs of becoming the global hub for the Bitcoin industry.

In 2015, British Prime Minister’s Office went a step further and made an effort to promote Bitcoin industry overseas. The nation has been proactively supporting the digital currency industry.

Unfortunately things have changed over the past two years. While the government is still supporting blockchain technology, they are not so keen on Bitcoin anymore. Banks are no more listening to Bitcoin startups in the United Kingdom.

This has undermined Bitcoin’s progress in the country and driven cryptocurrency entrepreneurs out of the banking system.

According to a recent report by Deloitte, London is ranked at number one spot for fintech innovation (followed by Singapore). Yet, the country is far from legalizing Bitcoin as a payment method. Notably, Japan is the only country that has accepts Bitcoin as legal payment method.

UK Banks’ stance on Bitcoin Businesses

Cryptopay, a bitcoin brokerage, recently informed customers that it will no longer support British Pound deposits and withdrawals on account of new bank policies.

British customers are limited to Single Euro Payments Area (SEPA) at Cryptopay due to the cancellation of GBP deposit and withdrawal facilities.

Many U.K. brokerages and Bitcoin exchanges have suffered over the past three to four years as banks have started withdrawing their support for Bitcoin.

Britcoin for instance, rebranded as Intersango, faced problems with U.K. bank transfers before eventually closing. In 2014, Bit121 had a promising start, but banks withdrew their support and the exchange closed.

Such incidents have increased as Bitcoin keeps getting more popular in the country.

CoinJournal, a bitcoin publication, saw its banking services come to an abrupt end after its U.K. banking provider Barclays terminated its business account. CoinJournal received no official warnings prior to its account closure. Even more alarmingly, Barclays still hasn’t given a reason for the extreme action.

As per CoinJournal, the decision taken by Barclays to close its business account was an “automated” call, after seeing a pattern of banking transactions involving prominent Bitcoin exchange and service provider Circle.

These shutdowns are not limited to UK only. Similar cases can also be seen in Australia and New Zealand.

So is there a workaround? Yes indeed. P2P services fill in the void.

Peer-to-peer services (like localbitcoins) match individual buyers and sellers in the U.K. in lieu of traditional exchanges. Trust is established by reputation. Once the buyer has paid (usually through a bank transfer), the seller transfers the Bitcoins.

UK Banks Vs the Government

Even though banks and regulators in the UK are looking down upon Bitcoin, they are embracing the technology behind it – blockchain.

Former Prime Minister David Cameron wants to use blockchain technology to revolutionise governance and reduce global corruption.

He said, “what excites me is the potential that your technology has to fight corruption and to deal with failures of governance and governments and the rule of law all over the world.

The banking sector clearly have problems with the UK government, which is pro-blockchain. The situation is rather strange when the government is speaking in support of Bitcoin but the banking sector standing in the way.

It is worth noting that since the financial crisis, the taxpayer has become the majority shareholder in the Royal Bank of Scotland, holding at around 82% of the bank. This would normally translate into a certain amount of leverage by the taxpayer.

Whatever the reason is, banks in the United Kingdom have chosen not to work with Bitcoin. Being a decentralized currency as opposed to the traditional currencies is likely the root cause of the conflict.

At the outset, cooperation of banks is essential in order for Bitcoin to succeed in the long run. Money cannot just flow from blockchain economy to the traditional financial sector and vice versa without banks’ participation. (Waves platform is solving this issue – next section)

Bitcoin’s volatility makes it an unsuitable unit of account or store of value. While there is no better transfer medium today, its price against fiat fluctuates too much for most people.

The Bitcoin economy is unlikely to expand until Bitcoin is used as a means of payment. But it won’t be better suited without more growth and stability.

UK Media on Bitcoin

Over the past eight years, since the inception of Bitcoin, mainstream media in the UK has provided an unbalanced coverage of Bitcoin, often misrepresenting its origin, purpose and structure.

Some media outlets and economists have related Bitcoin to the “darknet operators” and harshly criticized the absence of a third party mediator or network administrator within Bitcoin.

As it turns out, this past week, British news outlet The Independent demonstrated that the mainstream media is finally beginning to offer balanced and fair coverage of Bitcoin and other digital currencies.

For whatever reason this change has come, it is good for Bitcoin. An increasing number of companies including the Wall Street Journal, Bloomberg and CNBC have begun to provide extensive and regular coverage on Bitcoin, reporting a fact-based analysis of the Bitcoin industry, Bitcoin price and companies.

The Independent has set a good example by offering fair coverage on Bitcoin. Recently, the media outlet published a paper to explain the basics as well as the intricate aspects of Bitcoin to its audience.

Even though The Independent described Bitcoin as a “mysterious” currency throughout its paper, it emphasized important technological and financial aspects of Bitcoin that must be considered by the general public. This includes its structure, decentralized nature, purpose, and policies.

One of the sections of paper read:

First, Bitcoin is digital. It can only be created, held and traded electronically. Second, Bitcoin is decentralized. It is not controlled by a central authority, such as a national bank. This means there is little risk that Bitcoin users’ wallets will be impacted by a change in monetary policy or that their savings will be taken away completely.

The use of the phrase “little risk” is an accurate description of the potential change in monetary policy in Bitcoin as a hard fork could lead to a change in the monetary policy of Bitcoin.

The Independent’s article on Bitcoin accurately explains the anonymity of the digital currency, which people still struggles to understand. It is one major reason which leads the public to believe Bitcoin is a type of criminal or illicit token used in the dark web is its anonymity.

The outlet emphasizes that Bitcoin is not anonymous at the moment, however, this could change as well if two-layer solutions such as TumbleBit or MimbleWimble is introduced in the future.

Interestingly, just recently, the Chinese government and the People’s Bank of China offered reasonable suggestions to Bitcoin exchanges and users, discouraging fake volumes and offline scam-like promotions.

Most of the western media outlets, started spreading wrong “China Bans Bitcoin” narrative, causing panic among Chinese investors and leading the price of Bitcoin down to $830. However, the price quickly recovered.

The point being, it is important to have fair and unbiased mainstream media coverage on Bitcoin.

As of now, Bitcoin is far from mainstream even when it is has over $21 billion market cap. For billions of potential users to fully understand the purpose, structure and the vision of Bitcoin, mainstream media companies must begin to offer fair and unbiased coverage on Bitcoin.

Scotland diverts its attention towards fintech

2017 may as well be called the “fintech year”, thanks to all the developments in the fintech sector driven by blockchain infrastructure and smart contract applications.

Traditional banking and financial institutions across the world are increasingly expressing interest in adopting these solutions. Scotland is one of them.

Governments have also recognized the importance of fintech and its contribution to the country’s financial services industry, which in turn has influenced them to attract these companies.

Scotland may soon emerge as the next fintech hub in Europe as the government diverts its focus towards promoting country’s financial ecosystem.

European financial technology sector has become competitive in the recent days as the EU countries are trying to fill the soon to be created void following London’s departure from EU.

Scotland is in a unique position as it decides whether to stick with the United Kingdom or severe ties to remain in the European Union. We might see another referendum in coming years.

A recent report on one of the payments and commerce publication lists Scotland’s thriving technology clusters which can drive the country towards attaining the financial powerhouse status.

Scotland has been dealing with fintech and cryptocurrencies for a while. As of now, the country wants to focus its attention and resources towards fostering a robust fintech ecosystem.

The country has been known for its industrial excellence in steel, petroleum, shipbuilding and more. It wants to make its presence felt in the global fintech sector, aspiring to become the next financial hub of Europe.

If the reports are to be believed, Glasgow will be one of the many European cities worthy of taking up the mantle of Europe’s next financial technology hub. Scotland is already considering the use of cryptocurrency as legal tender if the separation from the UK happens.

Scottish government is taking a proactive approach to encourage the growth of Fintech sector in the country. It has appointed the CEO of Nucleus Financial at the Royal Bank of Scotland as Fintech envoy.

Notably, Scotland is set to have its own blockchain based stock exchange — ScotEx sometime this year.

Brexit Effect on UK Bitcoin Exchanges and Taxation

The question remains, how much of an impact will Brexit have on the Bitcoin industry? Moreover, how will this historic vote affect taxation of virtual currency?

If things go as planned, by next year, Britain will no longer be a part of EU. There will undoubtedly be some significant changes especially in the field of legislation and regulation.

It goes without saying, Bitcoin exchanges in the region will be hit the hardest.

Coincorner is one of the only Bitcoin exchanges in the United Kingdom allowing customers to buy cryptocurrency with their credit or debit card. The company also welcomes European users, but now that the UK separated itself from the EU, it remains to be seen how these transfers will be handled.

The same is the case with Coinfloor, Bitbargain, and Bittylicious, all of which are active in the United Kingdom. Even though these platforms are focused on the UK region, they still may face new regulatory requirements.

The situation remains very uncertain for the time being, as the full effects of the Brexit have yet to become apparent to the world.

On the flipside, these exchanges could see an influx from new users looking to buy Bitcoin in the coming weeks. Pound Sterling continues to lose value as compared to other world currencies. This may make consumers look for safe heaven alternatives.

A lot of people see Bitcoin as an investment with its value only increasing every year. Brexit may spark renewed interest in cryptocurrency as a whole.

The taxation will be a tricky part once Britain leave the EU. As of now taxation of Bitcoin falls under the same guidelines as the rest of Europe. In 2015, the European Union decided not to tax Bitcoin, and it still is the case. But things are a bit different in the UK, as there is a decree that would see Bitcoin transactions taxed by up to 20%.

The library of Congress website clearly says:

While bitcoins are not regulated, it has been reported that Her Majesty’s Revenue and Customs has classed bitcoins as ‘single purpose vouchers,’ rendering any sales of them liable to a value-added tax of 10–20%. This has been strongly criticized by those selling bitcoins as being a show stopper for the UK Bitcoin industry. There is no specific reference on Her Majesty’s Revenue and Customs site to bitcoins.

It still remains to be seen whether or not the UK government will decide to enforce this rule in the future. They of course have the opportunity to tax Bitcoin, which is a bit unsettling.

Waves – a custom blockchain tokens platform

Waves is a decentralized platform that allows any user to issue, transfer, swap and trade custom blockchain tokens on an integrated peer-to-peer exchange. Tokens may represent a share in a crowdfunding project, a financial instrument, or any other item with inherent value.

The platform raised $16 million last summer through crowdfunding. Waves can act as a gateway between the blockchain and the fiat world.

Customers pay money into the gateway using a bank transfer or other suitable means, and the gateway issues them the same sum in blockchain tokens. Same exchange occurs in reverse when customers cash out their Waves GBP and have them sent as “real” GBP to their bank account.

Since every transaction is recorded on the blockchain, scalability issues have plagued cryptocurrency platforms for a while now. The requirement of resources to process and store the information continues to increase.

As we’re aware there have been numerous scalability proposals for Bitcoin itself, including Segregated Witness (SegWit) to improve its current maximum capacity and allow greater adoption.

The Waves team has made a series of publications and presentations aimed at addressing various aspects of scalability which will be integrated into the Waves protocol in near future.

Leonid Reyzin, professor of Computer Science at Boston University, delivered a presentation titled “Improving Authenticated Dynamic Dictionaries” [Video] at Real World Crypto 2017. It outlined the details about possible ways to streamline the large and growing key value store associated with blockchain transactions.

Waves platform is refactoring and optimizing the storage to reduce blockchain size so that it is ready for different implementations in the future.

Sasha Ivanov, CEO and founder of Waves, said that Waves can make money more efficient. By putting fiat money on the blockchain, Waves can make it more transparent and faster, and it can reduce the cost of sending it abroad.

He thinks Waves can introduce competition and encourage banks to become more accountable. If banks in one sector in one country won’t work with Waves, it will work with those in another jurisdiction.

That said, Waves does not immediately solve the problem of U.K. banks’ hostility to bitcoin, but it suggests the roadblocks are not impossible to overcome.

Waves Community Token (WCT)

Waves recently announced the launch of a new token called the Waves Community Token (WCT). The intention behind this launch is community-based KYC/screening of new assets.

The new token distribution will enable Waves to foster community engagement in the next nine months. Initially, 20 percent of the WCTs will be distributed across all existing Waves wallet addresses based on their average WAVES balance between 1st and 15th January 2017. The initial distribution will be followed by 8 similar distributions in tranches of 10 percent each time.

Waves community members are required to have their balance in Waves local wallets in order to be able to receive the WCTs. Whereas, any Waves tokens on exchange platforms are not eligible for WCT distribution.

Instead of just being an alternative to Ethereum’s DAOs, WCT improves upon it by offering better security, reliability and can serve a number of purposes.

WCT can be traded and transferred freely. The WCT distribution timeline incentivizes long-term holding of the tokens in the local wallets and in turn encourages keeping them away from exchanges.

Waves plans to use a decentralized voting mechanism for an accurate reflection of community sentiment about new projects without putting funds at direct risk.

UK to track taxpayer money using blockchain

The UK government is looking into using the blockchain technology to increase efficiency in the distribution of taypayers’ money such as grants, student loans and more.

All around the world, banks and other financial institutions are increasingly investing in blockchain technology, thinking it could cut their costs and make their operations faster and more transparent.

The cabinet office minister Matt Hancock said the government was examining how the technology could be used to manage and keep track of the distribution of public money, saying it could “foster a new culture of trust”.

He said, “The government cannot bury its head in the sand and ignore new technologies as they emerge,

That is partly what happened in the past in government with the web … We cannot let (that) happen again by standing still.

Hancock cautioned against getting too caught up in the hype. “Blockchain technology is not going to solve every problem; it’s not going to work in every context,” he said.

Considering how Britain has had not-so-good record with government IT systems. Previous IT problems have hit the passport agency, the tax credit system and most notably the National Health Service which was forced in 2011 to announce the abandonment of a multibillion pound scheme to computerise every patient record.

The Bank of England has called blockchain a “key technological innovation”, and has a team working on ways that it could be used, such as for issuing central bank money.

Barclays and UK Regulators Endorse Bitcoin

Barclays, Britain’s No. 2 bank with 1.5 trillion pounds ($2.1 trillion) in assets and the U.K.’s Financial Conduct Authority opened the British market to Circle Internet Financial Ltd. – a startup that uses bitcoin to allow users to send each other payments.

Once the app is launched, U.K. consumers will be able to use Circle’s “social payment app” to transfer sterling for free.

Barclays will be responsible to provide the company with commercial banking services. FCA, on the other hand, which has set up an “innovation hub” to stoke the development of fintech companies, granted Circle an e-money license to conduct business in the U.K.

It’s very telling to see Barclays banking a company engaged in bitcoin-related activities,” said Eric Van der Kleij, the former head of Level39, a London-based firm that helps nurture fintech startups. “The announcement has the industry wondering if this is one of the turning points for the Internet of money.

Banks in the UK have largely avoided Bitcoin till now partly because cybercriminals use the cryptocurrency to fund drug sales and other illicit activities on the Internet. As a result, many Bitcoin startups have found it difficult to even open bank accounts at British lenders.

UK Tests Blockchain Based Social Welfare Payments

London-based blockchain and fintech startup GovCoin Systems Ltd. has been chosen by the UK Department for Work and Pensions to trial a new blockchain-based trial for welfare payments.

United Kingdom’s Department for Work and Pensions has an ongoing proof-of-concept trial where welfare payments are being recorded on a distributed ledger or blockchain.

The trial is aimed to develop a more effective and tamper-proof technology to be adopted by recipients of the welfare system.

The trial also sees the participation of leading UK bank Barclays, energy giant RWE npower and leading public research university, University College London.

David Freud (Lord Freud), the Minister for Welfare Reform at the UK Department for Work and Pensions, said, “We have been working with GovCoin Systems (and partners) for this trial,

Claimants are using an app on their phones through which they are receiving and spending their benefit payments. With their consent, their transactions are being recorded on a distributed ledger to support their financial management.” he added.

Although the details of the trial are not enough, it stands as one of the early examples of a blockchain application and solution, in the public sector.

Barclays Corporate Banking vice chairman Jeremy Wilson noted the additional layer of data and identity enabled by blockchain innovation, now embedded onto payments.

He said, “This strand of secure, tamper-resistant data would help a more effective exchange and the relationship between claimants and the government,

We are keen to see how the positive potential of this service develops and adds to our wider efforts to explore the uses of distributed ledger technology”.

A bitcoin-style monetary system could spell the end for Britain’s banks

According to a senior executive at the UK central bank, The Bank of England (BoE) could become the hub of a bitcoin-style digital currency that sidelines high-street banks and cuts the costs of financial transactions.

A new system of holding cash in a banking version of the cloud, with encrypted keys to protect accounts, would likely prove a huge hit with customers.

Whereas, Broadbent, formerly a Goldman Sachs economist, dismissed claims that bitcoin was in a position to replace pounds and euros. He argued that the structure behind the most renowned digital currency could be adopted to circulate the existing currencies.

He said blockchain could become parallel form of distributing funds and making financial transactions with the Bank acting as a backstop.

This would directly reduce the cost of electronic transactions that are handled by the banks, which was one of the main motives behind Bitcoin to begin with.

“The hope is that, by displacing these various middlemen, a distributed ledger would result in a cheaper and more secure system for providing these services,” Broadbent said.

Banks are at the heart of the current financial structure and provide a trusted platform for maintaining and protecting deposits. Bitcoin is challenging this. Clearly, banks don’t like it. They also act as counterparties in transactions, making sure that funds have moved from one account to another.

Banks retain vast computer systems usually dating back decades to store, verify and transact currencies for which they impose significantly high fees and charges.

Just last year, Bank of England said Bitcoin could impose a threat to financial stability in the UK should it increase in popularity.

Although it concluded that its inherent volatility and the prospect of higher transaction costs meant it was unlikely to win over enough users to supplant the existing banking system.

Blockchain gets the praise while Bitcoin is looked down upon. We have seen this time and again in different countries.

The government’s chief scientific adviser, Sir Mark Walport, published a report into the potential impact of distributed ledger technology, arguing that they could be used in the collection of taxes and the health service to improve services.

Surprisingly, Broadbent mentioned the vast markets in securities and bonds could shift to a distributed ledger system, in effect cutting out the $54bn cost associated with the large number of intermediaries involved in clearing and settling transactions. That is a big move from a bank in favor of blockchain technology.

Though it didn’t go without a warning. Broadbent warned that while it was technically possible to introduce such a scheme, there would be a high price to pay.

Shifting deposits to the central bank, and away from the leveraged commercial banking sector, has two important implications. On the one hand, it would probably make them safer,” he said.

The central bank, by contrast, holds only liquid assets on its balance sheet. The central bank can’t run out of cash and therefore can’t suffer a ‘run’.

Lloyd’s sees potential in blockchain

Lloyd’s, one of the leading banks in the UK recently held a seminar in London to highlight blockchains, to insurance market participants as part of their modernisation plan, called the Target Operating Model, or TOM.

Lloyd’s director of operations, Shirine Khoury-Haq said, blockchains could bring increased risk-recording abilities, transparency, accuracy and speed to the insurance markets.

The two blockchain use-cases floated at the seminar were for blockchain-powered digital ‘deal rooms’, where documents can be securely shared and logged, and a new token on a permissioned ledger for insurance markets.

Mainelli said online digital deal-rooms could significantly change the way business is currently done in the London Market. The current technology relies on physical proximity to one another, personal relationships and paper documents to get deals done.

An online deal-room using a blockchain could make the London Market more attractive to international business, which could drive significant growth for Lloyd’s and the London Market, he pointed out.

If we were sitting in Hong Kong right now and decided to create a global insurance market, we could build a quick deal-room and we would automate it from the start,” added Mainelli.

A blockchain-based deal-room would strip out the need to trust an intermediary while providing an accurate record of the documents shared by the deal’s participants.

IOHK Initiates Cryptocurrency and Blockchain University Network

IOHK is a technology company that specializes in blockchain and cryptocurrency development for academic institutions, government entities, and corporations. The startup is building a network of university partnerships.

It aims to tether academic research with emerging technologies like Bitcoin. So far it has partnered with the Scotland-based University of Edinburgh, as well as the Tokyo Institute of Technology, to bring together academics and students for cryptocurrency and distributed ledger studies.

While The University of Edinburgh will launch a Blockchain Technology Laboratory in its School of Informatics, the Tokyo Institute of Technology partnership will provide a similar center dedicated to cryptocurrency and blockchain innovation in the academic space.

IOHK says the research lab at the University of Edinburgh will serve as the network of universities’ headquarters. The company also expects to create university-based research labs in the U.S. and Greece later this year.

One of the co-founders of IOHK, Jeremy Wood, said, “IOHK’s partnership with the University of Edinburgh provides unique opportunities for current students to become the next generation of blockchain and cryptography leaders,

As a headquarter for IOHK’s international academic research community, we expect to see the university facilitate innovative projects that drive how businesses and governments approach blockchain and cryptocurrencies.” he explained.

The schools in Tokyo and the UK will join a growing list of universities dedicated to researching subjects like bitcoin and its underlying technology, blockchain.

UK Royal Mint Begins Testing of Blockchain Gold Trading Platform

The UK’s Royal Mint and CME Group have begun live testing the Royal Mint Gold (RMG), a blockchain-backed digital gold product aimed at providing a new alternative way to trade physical gold that is cost-effective, convenient and assured.

The CME electronic platform for RMG, powered by AlphaPoint, is being tested with institutional traders. It represents the first institutional trading platform for digital gold.

Vin Wijeratne, CFO of the Royal Mint, called distributed ledger technology “a game changer,”

Developing a trading platform with CME Group will satisfy customer demands for faster, cost effective and secure ways to buy, hold and sell gold and complement our existing products,” Wijeratne said.

This landmark partnership allows us to combine the world’s leading mint, the best commodities futures trading platform globally and best in class technology.

Each RMG represents ownership and full title to 1g of physical gold bullion sitting in the Royal Mint vaults. The platform will allow investors and traders to trade RMGs using their digital wallets as well as redeem their RMGs for physical gold bars and coins produced by the Royal Mint.

The Royal Mint plans to launch the product backed by up to US$1 billion in gold bullion later this year.

CME Group has partnered with blockchain startup AlphaPoint to provide the trading platform. The group is responsible for developing and operating the RMG’s digital platform and has also been working alongside BitGo, the developer of the blockchain code, to develop the architecture, rules and parameters of the platform.

As per Sandra Ro, head of digitization at CME Group, the new blockchain product offers an entirely new trading ecosystem for gold, providing speed, security as well as transparency of direct ownership. Ro stressed on releasing it as open source code ahead of its launch.

We are open sourcing elements of it but we don’t want to give the illusion that this is an open network. It’s not initially,” Ro said.

It’s a permissioned private network, and we’re going to be allowing for some of the source code – which is based on Bitcoin anyway and which is already open source – to be enhanced and modified.

What we need are people who are not only going to buy and hold RMGs from a long-term perspective, but we also need people who are going to help the secondary market grow.

Bank of England Explores Blockchain for Real-Time Money Settlement

Article 50 has been triggered and Britain has formally started the process to exit the EU, after 44 years.

In order to safeguard the stability of the United Kingdom’s financial system, the Bank of England is exploring the next generation of its Real-Time Gross Settlement (RTGS) service, according to a bank document.

RTGS is the platform for providing sterling central bank reserves to provide safe final settlement for transactions between banks.

It is clear that the characteristics of distributed ledger technology are attractive to the bank from a financial stability perspective. It is unlikely, however, that DLT will prove sufficiently mature to form the basis of the next generation of RTGS.

Pressure on traditional business models, along with the opportunities presented by new technology, have resulted in the unbundling of financial services, leading to the emergence of new competitors. The RTGS should change. It’s service must be able to respond to the changing structure of the financial system.

The new service must interface with technologies being used in the private sector, including distributed ledgers, if and when they achieve critical mass. The distributed ledger, still in its early stage, is a more radical innovation that creates new ways for firms to exchange value without relying on central infrastructure.

While originally designed to remove the need for banks, blockchain or distributed ledger technology (DLT) can potentially help banks in cutting costs.

What does blockchain bring to the table?

Blockchain technology is relevant in three contexts. First, as a platform for core RTGS settlement. Second, as a platform for externally-managed securities settlement delivery versus payment (DvP) or foreign exchange payment versus payment (PvP) services requiring access to central bank money.

And, third, as a platform for a digital currency that would interoperate with RTGS. Three distributed ledger benefits are trust, resilience and shared state.

The trust is based on the consensus needed to update the ledger. The resilience comes from the network’s geographical and technical diversity. The shared state arises from the ability to prove a node is up-to-date.

Among the three, resilience is the main potential benefit when applied to settlement in an RTGS system. The central bank operating as a neutral party already creates trust. Simple reconciliations manage the shared state.

The ability to distribute nodes physically that can operate differing software implementations, combined with data duplication across the network, could provide an RTGS system with a strong defense against cyber attacks and physical events.

Distributed Ledger Technology brings Resilience

The research indicates gross settlement and asset transfer can operate on a distributed ledger. It also demonstrates many network resilience features in a small-scale application.

That said, research also says the technology is not mature enough to provide the levels of robustness needed for RTGS settlement. More work is needed to address system scalability and privacy.

One method would be for RTGS reserves to support cryptographic tokens used by distributed ledger settlement platforms. These platforms could bring PvP and DvP to venues not currently available. It could also offer competition.

But designs for such platforms are in their infancy. Nonetheless, bank recognizes the technologies can reshape the payment landscape. The system will thus be developed to support the scale and interoperability needed to promote safe, final settlement of obligations in new settlement venues.

The bank also will explore the privacy, security, interoperability, scalability and sustainability of distributed ledger platforms.

Britain’s Position Post-Brexit – Final Words

There have been many discussions surrounding London losing its spot post-brexit as a leading global fintech hub.

It became particularly interesting after Paris Europlace, which promotes French finance plans, chose to travel to London to entice financial firms and professionals.

The French government agency, Business France, distributed leaflets to promote the benefits of working and living in Paris.

In Frankfurt, officials set up a specialist hotline for banks that want to discuss moving operations outside of the United Kingdom. Jochen Siegert, the chief operating officer of Traxpay, a Frankfurt-based payments platform, described London as having “committed suicide” as a leading fintech centre following the vote.

Of course, it is a shaky start for London and its vital business statistics in fintech direction.

According to the City of London’s website, the British capital handles $2.7 trillion of foreign exchange turnover each day – 41 percent of global foreign exchange while 20 percent of the world’s foreign equity market is listed in London. It is also home to 251 foreign banks.

It doesn’t get any better for Britain. There are obvious fears that these statistics could change in the future. Britain’s exit will likely shrink the talent pool, put off foreign investors and damage the country’s fintech status.

If that does happen, roughly £6.6 billion worth of revenue generated by the U.K. fintech sector in 2015 alone, according to a report by Ernst & Young and HM Treasury, could be split with another major city or across various cities.

The same report ranks London as the top global fintech hub regarding market size, investment, workforce, light-touch regulation, and supportive government policy.

That being said, London – and to a larger extent Britain – still stands as the best option to be the world’s fintech hub today. The structure of the country is as such that it makes it compact for being a meeting point for the fintech sector.

Better than the US, whose finance and tech hubs, New York and Silicon Valley, are miles apart.

In the coming years, top digital currency Bitcoin and distributed ledger technology (aka blockchain) will play a crucial role in the global fintech sector. Its use will supposedly be higher where there is a larger concentration of fintech startups.

Buy Bitcoin in United Kingdom

As mentioned earlier in the article, British banks are reluctant to service bitcoin companies. So many exchanges are having to bank elsewhere in the EU.

In these cases, you’ll have to put up with charges on international transfers like SEPA and often wait 2–5 days for your funds to arrive.

Even though we’ve had regulators saying that Britain is a cryptocurrency friendly country, the reality is very different. As it stands, a UK exchange providing SEPA bank transfers offers few advantages over any exchange in the EU – apart from being able to deposit in GBP, perhaps.

1. Bittylicious

Bittylicious is a Bitcoin exchange located in the United Kingdom. Customers can purchase bitcoin instantly via Barclays Pingit, Faster Payments-enabled bank transfer, Paym, or credit/debit card. It guarantees refund in case of delayed payment.

2. QuickBitcoin

QuickBitcoin lets you buy bitcoins in the UK in under an hour, utilising online bank transfers. They also offer a unique anti-ransomware service to help you unlock a computer affected by such malware.

3. Coinfloor

Coinfloor is another exchange based in the United Kingdom. They operate as both a Bitcoin exchange (Coinfloor Exchange) and broker referral service (Coinfloor Market). Coinfloor’s Exchange service accepts deposits in GBP, EUR, PLN and USD.

Customers can deposit to the Market via UK bank transfers and to the exchange via bank transfer, SEPA, or SWIFT.

4. Bitstamp

Bitstamp is one of the longer running Bitcoin exchanges. It has been around since 2011 and is a licensed exchange with the Luxembourg’s Ministry of Finance.

It is a good option for traders and those buying large amounts of bitcoins. Since Bitstamp is geared towards traders, you might find its fees a bit confusing. The fees you pay depend on your total volume. Unless you trade high volumes, you will likely pay 0.25% per buy.

If you buy bitcoins on Bitstamp with your credit card then the fees will be 8% for purchases up to $500 or €500. There are other exchanges that offer lower fees for buying bitcoins with a credit card or debit card.

5. CoinCorner

CoinCorner is a Bitcoin exchange based on the Isle of Man. They cater to users in the UK, Europe, Canada, Australia, and certain African, Asian, and South American countries. CoinCorner users may purchase bitcoins with SEPA, credit/debit card, GBP bank transfer, and now Neteller too.

It also has video tutorials covering the basics of Bitcoin and buying and selling Multi-sig security features.

6. Cubits

Cubits is based in the United Kingdom. It allows users in almost every country besides the United States to purchase bitcoins, using a wide range of currencies and payment methods.

The payment options include SEPA, SWIFT, credit cards, OKPAY, SOFORT, Skrill, Dotpay, and online bank transfer.

7. CryptoPay

CryptoPay is a Bitcoin broker based in the UK. Residents of the UK can purchase bitcoins in minutes via local bank transfers. Customers from other European countries can purchase bitcoins with SEPA transfer.

8. Coinbase

Coinbase is the world’s largest Bitcoin broker. They represent an easy and fast way for new users to purchase bitcoins. Coinbase supports customers in over 30 countries, including the United States, Europe (besides Germany), UK, Singapore, Canada, and Australia.

Customers in the above-mentioned countries can purchase bitcoins by credit card, debit card, bank transfer, SEPA transfer, and more.

9. Localbitcoins

LocalBitcoins is an escrow service which also helps to match bitcoin buyers and sellers. The most common method of payment for purchase is cash deposit. However, users may advertise trades for whichever payment method they prefer.

Buying bitcoins via an in-person meeting, secured and facilitated by LocalBitcoins, may be one of the fastest and most private ways to buy bitcoins in any country.

When you use this service, make sure you check the rantings of the seller. Beware of scams and always follow the rules.

10. Bitcoin ATMs

There are 60 Bitcoin ATMs in the United Kingdom. These ATMs allow you to buy Bitcoin with cash. The process is extremely quick, easy and private. That convenience and privacy, costs you 5-10% fee.

Spend Bitcoin in United Kingdom

One of the criticism that Bitcoin usually get is that there’s no easy way to spend them. Sure you may get strange look in most shops if you choose to pay via Bitcoin, but an increasing number of businesses are adopting it everyday.

1. PrivateFly

If your travel budget is a bit too high you could always hire a private jet from PrivateFly. Search for the nearest airport to you and your destination, select what sort of aircraft you’d prefer, from smaller propeller planes to a Boeing 747-200 with 450 seats, and enjoy your travels in luxury.

2. 8 Ball Bikes

All 8 Ball bicycles are completely hand made, from the off-the-peg models to the fully bespoke custom builds. Think it’s time to lose some calories? Go for 8 ball bikes and pay with Bitcoin.

3. The Port Royal

Buy a pint at The Port Royal in Exeter and pay in Bitcoin.

4. Your Sushi

Your Sushi provides sushi-making classes across the country. Manu Letellier, the founder, wanted to stay ahead of the game by being the first to offer customers the chance to pay using Bitcoin, but another reason was to use Bitcoin deposits as a back-up savings account.

5. Nowell Associates

File your taxes using Nowell Associates. They love Bitcoin.

6. GirlMeetsDress

Hire and rent designer dresses for weddings proms or cocktail parties.

7. The Pi Hut

The no.1 store for all your Raspberry Pi accessories. Preloaded SD Cards, Power Supplies & More. Worldwide Delivery.

8. Stealth Vape

Stealthvape is more than a company; it is embedded in the soul of the vaping community.

9. CJS CD Keys

CJS CD Keys is a leading retailer of game CD Keys. Because of their excellent prices and service, they have generated a huge following and are now recognised as one of the largest and most reputable digital download stores in the world.

10. Gift off

The easiest way to buy gift cards with digital currencies. 24 currencies accepted. 164 gift cards available. Zero commission.

You can find the full list of merchants accepting Bitcoin at Coinmap.org and wheretospendbitcoins.co.uk.

To directly search for the products, visit spendbitcoins.co.uk and find the sellers accepting Bitcoin in Singapore for a particular product.

There are more than 150,000 merchants accepting Bitcoin worldwide. Here is the full list.

Conclusion

Bitcoin continues to serve as a safe haven in light of a major geopolitical shift – Brexit. It was evident when the price of Bitcoin increased leading up to and following Brexit.

Tough times are ahead for Britain. As per a report from McKinsey, European banks are at risk of losing a significant portion of their profits with digital disruption cutting their profits in half by 2020.

Banks in the UK will not only need to keep up with the digital disruption, but also a weak global economy and regulation.

They need to take steps that will ensure that they can counter these challenges by focusing on transforming themselves through resilience, reorientation, and renewal.

One way to go about it is to streamline their operating models and IT structure and move towards a proactive regulatory strategy. Link up with fintech hubs, platform providers, and other banks to share costs through industry utilities.