Will a National Cryptocurrency be Scotland’s Solution to a Life After the Pound?
Since the United Kingdom voted to leave the European Union in the June 2016 referendum, Scotland’s political leaders have been calling for a second independence referendum to gain separate from the UK.
While in the 2014 Scottish independence referendum, the Scottish people voted to remain part of Great Britain the situation has now changed. Many Scots at the time voted to remain part of the UK as well as to remain part of the EU. The desire of Scotland’s population to remain part of the EU was once again echoed during the ‘Brexit’ referendum, where the majority of Scots voted for Britain to stay in the EU.
Given that Britain is now in the process of leaving the EU, Scotland’s political leaders now believe that a second Scottish independence referendum is necessary to decide whether Scotland wants to remain part of Britain and leave the EU or whether it should go Britain and remain part of the EU.
While politicians are still debating and negotiating a potential date for a second Scottish independence referendum, one important question has been raised, and that is “what currency will Scotland use if it becomes independent?”
According to Glasgow-based entrepreneur and principal investor in the cryptocurrency project Scotcoin, David Low, the answer may be a national cryptocurrency for Scotland. While the Scottish economy and its banking sector, although distinctly separate, have benefitted from using the British Pound over the course of the last few centuries, will an independent Scotland decide to imitate bitcoin with a digital national currency?
Low invested in Scotcoin, which launched in 2013, during the time of the 2014 Scottish independence referendum. While Low considers himself to be an apolitical businessman and has not publicly stated his views on Scottish independence, he does recognize that a continuance of the British pound, as suggested by Scottish National Party’s Alex Salmond, would be absurd. Scotland will need a national currency to have control of its monetary policy he told the Financial Times.
Low recognizes that digital currencies will most likely play a role in the future global financial system and views Scotcoin as a viable alternative currency solution to the Pound should Scotland achieve independence from Britain.
Scotcoin has a small market cap of around $1.5 million, is sparsely traded on two cryptocurrency exchanges, and can be bought on Scotcoin’s exchange. While Scotcoin has a rather small market cap compared to bitcoin’s $16 billion, it does show that there is demand for, and an interest expressed toward this alternative currency. With a fixed supply of one billion Scotcoins, as the demand to hold Scotcoins increases, its price will increase as supply diminishes.
If you believe that Scotcoin could become a viable alternative currency or even official legal tender in Scotland in the future, you can claim free Scotcoins on the Scotcoin Project’s website.
Whether Scotland will become independent from Britain or not is an unknown. However, what currency it will adopt should independence be achieved will be an interesting development to follow. The most likely post-independence currency scenario will be a transition period where the Pound will still be accepted until a new national currency will be adopted. Whether that will be the Euro, a new Scottish Pound or even a digital currency solution like Scotcoin remains to be seen.