HOLDERS of the digital currency Scotcoin will be given a bonus of four times their stake if they transfer, or "migrate", to a new version of the coin.
The Scotcoin owners are building a new blockchain, the engine which drives cryptocurrencies. The present one handles the buying and selling of coins, as a kind of digital bureau de change, with the information on transactions shared between thousands of computers throughout the world making it, in theory, uncrackable.
"But it's creaking and it's expensive," says Scotcoin co-owner David Low, "so our new one will be cheaper, faster and more reliable." It will be, he adds, "the rock 'n' roll version".
To encourage the present 4,000 holders of the currency (including Sunday Herald readers who took up a free offer 18 months ago) to migrate to the new coin they will be offered four new ones for each one they hold. "We value each present coin at one pence, a hundred is a pound and so you'll get five pounds for your pound if you take up the offer."
That offer is likely to last six months but Low can't say when it will start – that will depend on when the new blockchain is finished, and he isn't putting a time on that. But he is confident that holders will make the switch. "Why keep an old Russian bearer bond," is how he puts it, "when you can have a dollar?"
Another advantage of the new system is that people will be able to switch directly to and from the main established currencies, like sterling, the euro and the dollar. And it will take the volatility out of crypto-trading because scotcoin will be linked to the pound and not bitcoin, which has been highly volatile. So its value will rise or fall with sterling.
Low has also offered scotcoin's IP address to the Scottish Government which, if taken up, would make it the country's official digital currency. He described initial meetings about it as "highly encouraging".
As he told the Sunday Herald in the past: “Here's me, a guy who makes money out of the system and I basically latched onto the currency issue, the single biggest thing which lost the referendum. An independent Scotland must have its own currency, for better or worse."
Low may seem an unlikely rebel against financial orthodoxy but the accountant and financial adviser has a starry track record. It was him who organised, on the ground, the shareholder uprising which removed the seemingly impregnable families who owned Celtic and ushered in Fergus McCann, the jaggy bunneted Scottish ex-pat from Canada, who transformed the football club.
When the new scotcoin is launched, Low and his partner Temple Melville will hold a stake worth, notionally, around £950 million. But he doesn't intend to profit from it, all of it will go into what he calls a common wealth fund. "It will be the polar opposite of a sovereign wealth fund because it will benefit the poor and the disadvantaged." Administered by a group of "the great and the good", the plan is to pay young people in scotcoin to do good works for the benefit of the community.
It's a kind of quantitive easing in reverse, contrary to the present system where "the rich get richer and poorer get poorer, the poorer will get richer". If under-25s are given, say, pounds1000 or pounds10,000 "they can do with it what they want, save it or spend it and if they spend it then it benefits the economy".
To spend it they need outlets, and not just the Arlington Bar, which Low owns. "I'm confident that the big companies will get involved so that the kid will be able to walk into Greggs or M&S or any large retailer and buy what he or she wants using a card, just like now. It's coming. It's just a matter of time."
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