The British Parliament's Treasury Committee heard evidence on cryptocurrencies and Blockchain on Tuesday in a hearing which saw many different views bandies across the floor. Ripple, the inter-bank cryptocurrency which has been aiming to work with banks and governments, was especially criticized for some of its confusing functionality.
Moreso, Martin Walker, a director of the Center for Evidence-Based Management, called Blockchain in the financial space nothing more than a fad and dismissed its use outright.
It was primarily Walker who took the shots at Blockchain technology, which is strange seeing as the director of the non-profit Centre for Evidence-Based Management was once a former product developer at Blockchain consortium R3.
Walker claimed that the technologies are unlikely to solve inefficiencies in the financial sector, specifically criticizing Ripple's current products.
In defense of Ripple was Director of Regulatory Relations Ryan Zagone, Dr. Grammateia Kotsialou, a postdoctoral researcher at King's College London and Chris Taylor, chief operating officer at asset tracking Blockchain startup Everledger.
Zagone attested that Ripple’s key benefit was the fact that one could track money transfers. However, Walker countered by saying the company's model offers little more than the existing SWIFT messaging system.
"The hard thing about tracking payments is actually getting the people involved in the payments to actually upload the status. So simply having a Blockchain doesn't actually get people to update the status of where the payment is.”
Could versus is
Walker did not only find issue with Ripple but took total aim at the idea of Blockchain in the space of finance.
"There's a big problem in the Blockchain world with confusing 'could' for 'is,'" he said, adding "All that it takes to make a credible idea into a fad is people just switch off their brains and stop thinking. Over 20 years in and around the banking industry, Blockchain is a fad, but I have seen many fads in my career."
Harsh views in the UK
The UK, while currently not against cryptocurrencies, seems to be finding it difficult to embrace as their foray into regulations continues.
Bank of England Governor Mark Carney has called Bitcoin a failed currency previously, and this latest showing in front of Parliament does not bode well for the UK Government’s position on cryptocurrency.
However, at the beginning of this hearing, it was stated the intention was not to stifle the technology.
The Treasury Committee says it will study how overseas governments and regulators have approached digital currencies and learn from them.
“Striking the right balance between regulating digital currencies to provide adequate protection for consumers and businesses, whilst not stifling innovation, is crucial. As part of the inquiry, we will explore how this can be achieved,” Nicky Morgan, the chair of the committee, said.