Nothing Gold Can Stay: Royal Mint Cancels Gold-Backed Cryptocurrency Plans

Reuters reported on October 25th that the institution responsible for printing coins for circulation throughout the UK, Her Majesty’s Royal Mint, has canceled plans to launch a gold-back cryptocurrency following the government’s decision to veto the project.

The plans to create the currency were originally made public all the way back in 2016. According to those now-defunct plans, the Royal Mint was going to issue as much as $1 billion worth of the virtual tokens, also known as Royal Mint Gold (RMG.) RMG was to be traded on a blockchain platform created and operated by the Chicago Mercantile Exchange (CME.) The RMG wallet was to be developed by blockchain security company BitGo.

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RMG was being developed as an efficient and simple way for investors to purchase and exchange the physical gold held by the Royal Mint, and to act as a new stream of revenue for the institution.

The original launch date for the tokens was set for fall of 2017, and was later postponed to early 2018. However, three anonymous sources explained to Reuters that the Royal Mint had been abandoned by CME at the last minute: “CME’s management changed, and they walked away, didn’t want to get involved.”

Sources Cite “Priority Shift” Away from Digitization; CME Denies

Reuters’ sources also said that CME’s decision to walk away from the plans was reflective of a general “cooling of enthusiasm towards digital assets.” They also said that priorities had had shifted away from digital assets as the result of the retirements of CEO Phupinder Gill (late 2016) and head of digitization Sandra Ro (2018.)

However, CME was one of the first companies to launch bitcoin futures trading on its platform last year; according to Reuters, CME’s venture capital sector has also invested in a number of digital assets startups.

CME also refuted the claims in a statement to Reuters: “It is not correct to say we have ‘de-emphasised’ digitization and remain committed to pursuing our digitization strategy.”

The Royal Mint reportedly attempted to continue the project early this year via a new partnership with an unidentified cryptocurrency exchange. However, the UK’s finance ministry killed off the initiative–although the Royal Mint did tell Reuters that “we will revisit this if and when market conditions are right.”

The would-have-been RMG is one of a number of prospective nationally-issued cryptocurrencies that governments of many countries are considering creating all around the world. Australia’s Perth Mint publicized plans to issue its own gold-backed cryptocurrency earlier this year.