Design of social digital currency

Digital currency or digital money is distinct from physical banknotes and coins: in fact shows properties similar to physical currencies but allows for instantaneous transactions and borderless transfer of ownership. The Professor at Stanford University Graduate School of Business, Susan Athey (2015), states that digital currencies have the potential to change radically the way we transfer money from person to person in the same way that email and the World Wide Web changed the way and the concept of information sharing. However, significant challenges exist in helping to educate and inform businesses, the public, government and regulatory bodies as to the true potential of the underlying emerging technology as can be used to buy physical goods and services, or could also be restricted to certain communities such as for example for use inside an on-line game or social network. In August 2014, the UK government proposed a survey aiming at looking into the benefits and risks associated with digital currencies and underlying technology, with a particular focus on the question of regulation. After a couple months, in November 2014, the government published a call for information to gather views and evidence on these questions and received over 120 responses. Members of the public who use digital currencies, digital currency developers, businesses providing digital currency-related services, banks, payment scheme companies, academics, consultancies and other government departments and agencies responded the survey. At this embryonic stage, the government's objectives for digital currency technology and the wider market are: ¿ to provide clarity and certainty on the norms, regulation and applications for users, businesses and other parties dealing with digital currencies; ¿ to limit and prevent for criminals or terrorists to use digital currencies for illicit activities; ¿ to develop the right environment for the legitimate use of digital currency; ¿ to support the research, improvement and application of new technology, to promote competition and innovation in payment systems and financial services; ¿ to monitoring the extent of usage of digital currencies in the UK and understand the dynamics needed for the technology to flourish. This research conducted by the HM Treasury (2015) looks at the benefits of digital currencies as a payment method, and the potential for innovative applications of the technology across financial services and beyond after a correct development and a good regulation. In this document will be considered also the barriers to digital currency firms setting up in the UK, and what steps the government could take to support the growth of the industry. The government considers that digital currencies, when used legitimately, offer an innovative, alternative payment option, which competes with existing payment models and has particularly clear short-term advantages for micro-payments, overseas remittances and cross-border trade: it is possible for users to transfer value (or other information) quickly, efficiently and securely, providing a permanent record of what has taken place, and without the need for a trusted third party to oversee the process.