MPs launch inquiry into bitcoin boom

MPs are launching an inquiry into bitcoin and other cryptocurrencies in a bid to evaluate the benefits and risks of the technology.

The Treasury Committee will investigate the impact of digital currencies on banks and consumers, as well as assessing “whether they could ultimately replace traditional money”, Bloomberg says.

The 11 members of the committee will also “scrutinise how to police cryptocurrencies”, as the booming market currently has “little transparency or accountability”, the website says.

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Cryptocurrencies became a hot topic towards the end of last year, following the meteoric rise and fall of digital coins including bitcoin and Ethereum, says the BBC News website. Critics dismissed the technology an “investment scam” and “a vehicle for criminals and tax evaders”.

Despite such fears, the technology behind cryptocurrencies, known as blockchain, has been praised by financial and tech experts.

Nicky Morgan, the chair of the Treasury Committee, said: “People are becoming increasingly aware of cryptocurrencies such as bitcoin, but they may not be aware that they are currently unregulated in the UK and that there is no protection for individual investors.”

The committee will aim to strike “the right balance between regulating digital currencies to provide adequate protection for consumers and businesses” without “stifling innovation”, Morgan added.

According to Reuters, the committee will “take written and verbal evidence from a range of experts on the digital currencies”.

The group will then submit a report to the Government “containing recommendations on what to do”, the news site adds.