UK Government Scraps Plan To Launch A Gold Backed Cryptocurrency

The Royal Mint’s plan to launch a “digital gold” token that would be listed in crypto exchanges has been scrapped by the UK Government. The Royal Mint is a government-owned mint that produces coins for the United Kingdom.

Apparently, the Mint had plans to issue a massive quantity of these “Royal Mint Gold” (RMG) tokens, amounting to a value of almost $1 billion. The tokens were supposedly going to be stored in the Mint’s vault and would have been backed by gold assets.

A Mint spokesperson has commented,

“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.”

So why did the government stifle this plan?

Word is, that Mint was looking to launch this project sometime last year and had collaborated with CME to list the tokens on a blockchain-based exchange, that CME operates. However, due to some yet undisclosed reason, CME backed out of the partnership at the last minute and subsequently delayed the project.

This left Mint in the dark and they were desperately looking for an exchange which would list the tokens. That is when the government stepped in and they decided that this was now getting too risky a project for Mint to pursue anymore. Hence, they refused to give a go ahead to this idea.

As a result, Mint’s CEO Anne Jessop had to shut down the project and lay off four employees. This move also rendered another 7-8 employees as redundant.

While speculating on CME’s reasons to walk away, sources claim that “CME’s management changed, and they walked away, didn’t want to get involved.” Whether it is simply a change in management that prompted this decision or something deeper, we are yet to discover. CME however has told Reuters that it was “continuing to assess client demand with our partner and have nothing new to report at this time.”

However, if the full volume of the tokens had actually been listed on a public blockchain, it would have ranked among the world’s most valuable cryptocurrencies.