UK Government Considers Paying Research Grants with Bitcoin

Rage Comment : Matthew Hancock, Minister of the Cabinet Office and Minister of the Treasury, said today that the Cabinet Office has begun to explore the use of blockchain technology, especially studying how to apply it to government research funding expenditures. Monitoring and controlling the use of research grants is very complicated, and the characteristics of blockchain can solve this problem well. If the technology is applied to the government, it can save costs, improve transparency, increase financial inclusion of citizens, and promote innovation and economic growth.

Translation: Nicole

UK government considering funding bitcoin research

The UK government is exploring the use of Bitcoin (or other blockchain-backed alternative currencies) for payments while monitoring taxpayer research grants.

The Cabinet Office has begun exploring the use of blockchain technology, particularly for government research funding, Cabinet Office minister and Treasury secretary Matthew Hancock said today.

Matthew Hancock

Hancock was speaking at Digital Catapult, a government-funded think tank:

“Monitoring and controlling the use of research grants is very complex. A blockchain technology that can be used by multiple parties is a good way to solve this problem.”

Hancock cited blockchain as a good example of a "distributed ledger" that can also be used to track currency.

Politicians have always been wary of using blockchain technology — usually because of its promise of cost savings and increased transparency — and bitcoin has the potential to fuel a black market in digital currencies.

George Osborne

Prime Minister George Osborne has in the past preferred to refer to digital currencies such as Bitcoin as “digital currencies” when discussing them publicly.

But the Cabinet Office is not unwilling to discuss Bitcoin. The spokesperson said that using Bitcoin for payments is possible, and the Cabinet is not rejecting any technology. The spokesperson said:

“The government is looking at any use cases for blockchain technology, including Bitcoin. The government welcomes all blockchain applications. Blockchain technology can be used in many areas, including government grants. It can also be used to track funds and give taxpayers greater peace of mind.”

The Cabinet Office did not disclose further details about the blockchain.

The UK government has also been increasingly supportive of Bitcoin and blockchain technology. Osborne used a Bitcoin ATM in 2014 and praised its importance in making the UK a leading fintech hub. Last year, he went further and announced a €10 million (US$14.5 million) grant to think tanks (including Digital Catapult) to research blockchain technology.

The government’s chief scientist also studied the technology and published a report in January. One section of the report was dedicated to studying blockchain technology for government applications. The report stated:

“If this technology is applied to government, it can save costs, improve transparency, increase financial inclusion for citizens and promote innovation and economic growth.”