Royal Mint’s Gold-Backed Cryptocurrency Blocked By UK Government

News | October 26, 2018 By:

The Royal Mint, which produces the UK’s currency and holds gold, has reportedly suspended plans to launch a gold-backed cryptocurrency.

The Royal Mint first unveiled its plans to issue digitized gold, dubbed Royal Mint Gold (RMG), in December 2016. The goal was to make RMG more cost-effective and provide increased transparency for traders and investors to trade, execute and settle gold. Blockchain tech firm BitGo was chosen to develop RMG’s multi-signature crypto wallet.

RMG was initially scheduled to be traded on a blockchain-based platform run by US exchange CME in mid-2017, but CME pulled out of the project at the end of last year, resulting in the Royal Mint no longer having a trading venue. Unnamed sources told Reuters that “CME’s management changed, and they walked away, didn’t want to get involved.”

To save the project, the Royal Mint turned to a crypto exchange to list the tokens, but Britain’s finance ministry blocked the plan in February of this year. The sources said the move was blocked due to concerns over potential damage to both institutions’ reputations, given the Royal Mint is wholly owned by the British government.

The sources added that after the finance ministry vetoed the plan, the Mint’s new chief executive Anne Jessop, appointed in February of this year, decided to shut the project down.

In a statement, the Mint said that RMG had been due to launch in spring this year. “Sadly, due to market conditions this did not prove possible at this time, but we will revisit this if and when market conditions are right,” it said.

At present, crypto exchanges in the UK remain unregulated. Regulators are currently looking at whether rules are needed for cryptocurrencies and the use of blockchain technology in finance.