Bitcoin Tech Based Digital Currency for Financial Reform

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It is high time digital currency became mainstream, and one Dr. Shann Turnbull recognizes it. Dr. Turnbull is the principal of the International Institute for Self-governance in Sydney and an author on reforming theories of capitalism. He has urged the Australian government to support and adopt bitcoin like digital currency as the country’s main currency.

According to Turnbull, Australia possesses the ideal conditions to implement digital currency, as the country already has high penetration of Near Field communication (NFC) readers and all personal medical and welfare account data linked to Medicare swipe cards connect to government portals, hence chosen as a candidate in his article. However, it doesn’t mean other countries can’t adopt digital currency to avail benefits to their economy.

Digital currency can help Australian economy in various ways starting with balancing the country’s budget, controlling the black market, reduction in taxes, democratization of credit and so on. With digital currency, people will pay for things through their accounts associated with their mobile phones and digital wallets. These accounts can be linked through the Australian Taxation Office (ATO), so that all transactions are accounted for. Even the government can deposit welfare money or collect taxes and fines directly from their wallets, eliminating corruption and tax defaults.

Australian dollar has been overvalued for some time now, resulting in lesser employment opportunities, especially in tourism and manufacturing industry. All these combined with export of educational services has made the very existence of Reserve Bank of Australia (RBA) and its functions questionable.

Dr. Shann Turnbull, in his publication “Might Supplementary Tethered Currencies Reduce Financial System Risks?” states the importance of using “bitcoin technology” but not bitcoin to create digital money, different from its current state. This will allow the countries to exercise control over their financial system by introducing Tethered, Tagged and Terminating (3T) currencies and reduce the risk of a financial crisis.  According to his paper – the short term incentive for governments to pursue 3T digital currency include-

• the pressing need to establish a more attractive alternative than Bitcoin in the event of another financial crisis,
• raise tax revenues by identifying profits shifting and money laundering from tagging transactions and
• tracing illegal or terrorist transactions.

Turnbull ends his paper by suggesting bitcoin to be treated as a commodity instead of currency as it does not meet all the 3T requirements of a digital currency.