Today we were very disappointed, though not suprised, by The Royal Canadian Mint.
Earlier this year, The Royal Canadian Mint caused a small press storm when they announced that they were developing a “digital cash” system. MintChip, as it was so adorably labeled, would be a system which used encrypted hardware devices to securely hold and transfer digital money.
Sites like TechCrunch picked up the story immediately, “Royal Canadian Mint’s “MintChip” Looks To Officially Digitize Cash.” Of course, the immediate comparison was made to Bitcoin, and indeed it was suggested by some that MintChip was a Bitcoin-killer, for it had all the benefits of Bitcoin with the additional prestige and legitimacy (and coercion) of a major government.
Of course, some of us realized the hype was unwarranted. First of all, there was no way hardware encrypted devices would hold up to a universe of hackers. Second, the suggestion that the payments would be “anonymous like cash” was laughable – even if the Canadian government was willing to let its citizenry have digital, untraceable cash, there is no way the US Federal Government would allow it. Third, there was no indication of limitations on the transfer amounts (can half a penny be sent? Can $1 million be sent?). And finally, MintChip wasn’t even a digital currency at all – but merely another electronic wallet in which standard fiat currency was stored (in this case, Canadian dollars).
So from the beginning, MintChip was suspect (Forbes’ Jon Matonis noticed this also).
However, MintChip did boast one very compelling feature – irreversibility. One of Bitcoin’s greatest attributes is that once a payment is made, it is “good money,” meaning it cannot be reversed by the payer. MintChip claiming the same feature meant that, in spite of the other reservations, perhaps it could compete with Bitcoin after all. More immediately, and with an amusing degree of irony, the irreversibility meant that MintChip was actually a great way to buy bitcoins! Unlike with credit cards, a seller of BTC could accept MintChip and send BTC immediately, without worrying about a chargeback. This was seen as a very big plus for Bitcoin itself – having a new funding option which, if the Royal Canadian Mint was successful, would become quite popular.
And here’s where it gets interesting…
On April 4th, 2012, the MintChip team announced a contest. The contest page, ideas.mintchipchallenge.com, stated:
“The Royal Canadian Mint is challenging you to share ideas for how you would use a digital currency”
Cool! Their idea was that they would crowdsource use-cases of how people might be interested in using MintChip. This was obviously done for the dual purposes of general PR awareness and also for user feedback.
Now, since MintChip has interesting parallels to Bitcoin, and us Bitcoiners realized we could use MintChip to purchase Bitcoin securely, of course we participated in the contest. User “Richard V” submitted the idea, “A digital currency can be used for purchasing Bitcoin.” Visitors at the site were then supposed to vote on all the ideas, in a +1 upvote style format.
The Bitcoin submission became the highest voted very quickly, and it remained the highest voted throughout the entire life of the contest (April 4th to August 1st when voting closed). In fact, the Bitcoin submission had more than three times as many votes as the second place option. It wasn’t even close. And beyond votes, it has the most comments by far – by any measure, it was the hottest submission in the contest.
And so today, Sept. 24, the The Royal Canadian Mint announced the winners. Ten of the submissions were chosen as the “Top 10 Winning Suggestions”… Bitcoin was not there. Not only did Bitcoin not get 1st Place, it was completely blacked out from the top ten. It wasn’t even mentioned.