UK Announces investment in digital currencies

UK Chancellor, George Osborne, announced yesterday, a £10 million boost from government for digital currency such as Bitcoin.  This was part of the UK “Budget” speech.  It aims to put London and the UK at the centre of investment in crypto-currency and other similar technologies.  All of these technologies have major implications for privacy.

What’s going to happen?

Here are the details:

  • Injection of £10 million into UK research for digital currencies.
  • New research initiative overseen by UK research councils; the Digital Catapult Tech Accelerator and the Turing Institute, as reported by the BBC.
  • Application of anti-money laundering regulations to UK markets where digital cash is traded (this will have implications under the new Data Protection Regulation which fails to properly address the tension between AML rules and data privacy).
  • Pledges to put about £140 million into research for smart cities, driverless cars and the internet of things.
  • Proposals to increase UK broadband speeds to 100 megabytes per second.

What does this mean for privacy?

The UK wants to be seen as pro-technology and pro-investment.  This is about improving the UK’s record on productivity to underpin the recovery.  For many, this represents the right focus and is all about investing in the future.  Clearly, a budget of a few 100 million isn’t going to get us there but it does mean that the tension between new technology, big datasets and data privacy will remain a big issue in the UK.  With the coming of the new Regulation (assuming it’s coming!) we need clearer guidance from Data Protection Authorities on how to adopt this technology in a privacy-compliant way.  The UK Information Commissioner’s office has done a lot of work on this already.  With the EU drive to dilute the “one stop shop” (under which you’re going to be regulated by the DPA of your main establishment) we need other DPAs to weigh in and (dare we say it…) reach a consensus.