First Canada eliminated the penny. Then it introduced a glow-in-the-dark dinosaur quarter that cost $30 to buy. Now the Royal Canadian Mint has announced plans to develop a digital alternative to all coinage (and, possibly, small bills), called "MintChip."
Canada is making it up as it goes along.
According to the narrator of the official introductory video released Wednesday, MintChip, still in development, will be "better than cash" and "so easy a child could use it."
MintChip will work by storing value on a physical chip, such as a microSD card or USB stick, transferring money between chips using heavily encrypted "value messages." The system is intended to be anonymous, as chips will not be linked to bank accounts or credit cards. MintChip will have no centralized database. MintChip will make everyone want mint chocolate chip ice cream.
Causing his own wave of dessert cravings is the Royal Canadian Mint's chief financial officer, Marc Brûlé, who also announced Wednesday a Mint-sponsored contest asking software developers to create smart-phone and other applications demonstrating MintChip's advantages as a form of digital currency.
The first prize winner will receive one 10oz gold wafer (more dessert-talk; I see you, Canada) worth $17,000.
Here are some examples of the kinds of small transactions ideally suited to MintChip technology, according to the introductory video:
- buying a decaf latte
- paying to read "a Canadian history article for school"
- "paying back that ten bucks you borrowed last week"
- buying a song
- paying to read a news article
- buying "a nifty glow-in-the-dark laser for your favorite online game character"
Responding to criticism that MintChip would be plagued by the same demons as its digital currency predecessor, BitCoin, Brûlé was dismissive.
"The system we would bring in would be backed by a fund. Bitcoin may work for the small group of people that believe in its value, but that could change very suddenly."
Let's just see how this one plays out.