The Bank of England’s reported digital currency Britcoin will likely send the price of Bitcoin higher, according to Nigel Green, founder and CEO of deVere Group.
Green’s comment comes amid news that the UK central bank is planning to launch a direct digital equivalent to physical money following the meteoric rise of cryptocurrencies over the past year.
However, Green says the move is likely to reinforce the belief that digital currencies are here to stay and prompt more people to move towards cryptocurrencies.
Green says: “Revealing just how worried they are about the ongoing epic rise and influence of Bitcoin and other cryptocurrencies, the Bank of England is reportedly set to establish its own digital currency. If the Bank and government officials believe Britcoin will supersede Bitcoin, they are mistaken. In fact, it will have the opposite effect.”
According to Green, by jumping on the so-called digital bandwagon, the BoE will validate the concept of Bitcoin and its values of being digital, global, borderless and more cost-effective than traditional money. As a result, Green says it is likely that innovation and development in the cryptocurrency market will increase and the pace of mass adoption will accelerate.
In addition, while Britcoin will share many of the benefits of Bitcoin, it will be controlled and manipulated by the BoE, meaning it has the power to adjust supply and therefore its value unlike Bitcoin.
Green says growing mistrust of the traditional banking system by consumers, particularly among younger generations, could also prevent Britcoin from earning the same appeal as Bitcoin.
Green adds: “The Bank of England’s reported move to set up Britcoin highlights that digital currencies are the inevitable future of money.”
