In the second episode of our new podcastIn Conversation With…our Managing Director, Ben Hutton, talks to the CEO of Scotcoin, Temple Melville.
Scotcoin is a community interest company that was founded back in 2013 with the purpose of giving Scotland’s its own currency in the event of independence in the 2014 referendum. Temple Melville purchased the IP from Scotcoin’s founder in late 2015 and has since focused on how Scotcoin can benefit the Scottish people and economy to help them be better off.
Ben and Temple talk about inflation, the resilience of crypto currencies, the shortage of skilled workers in blockchain and the importance of widespread access to cryptocurrencies.
Read a short extract from the interview below or watch the full conversation at the end of the extract.
Thanks for coming along. Instead of me reading out an introduction, I thought it would be better if you could introduce yourself. Is that OK?
Sure. My name is Temple Melville and I’m the CEO of the Scotcoin Project CIC. We’re a community interest company and our ethos is very much of the charitable nature. Scoticoin was founded by Derek Nesbit back in 2013 as something to help potentially with Scottish independence, if the referendum was won in 2014. It wasn’t won and he lost interest and had other issues so in the latter part of 2015 and early part of 2016, he sold us the IP.
Since then we realised the system it was on was not something that was going to be long lived in terms of usability so we’re mitigating it to a new ERC20 token (by Ethereum).
You’re talking to me from the middle of our migration, it’s happening as we speak.
I’m surprised you have any hair left, sir.
Well, actually, touching wood, I would say that things have been going pretty OK actually. Needless to say the minute we started to do the migration, all of the exchanges went berserk. I saw a bitcoin transaction the other day and it was $150 for the transaction cost as opposed to the usual $5 or $6 and of course Ethereum has gone up and followed suit. But, there are some out there that are $2 which isn’t quite as bad. Totally sod’s law, the minute you try and do something, everything falls on top of you...
On our side of it, getting people to fill in the forms and getting the KYC done is all going quite well, so that’s good.
That’s interesting because we do lots of onboarding projects to financial institutions and banks and challenger elements.
One of the challenges we have is that while people are a bit more broadly aware of their data, things like KYC still need to be explained to them and there are questions around it.
Does the cryptocurrency audience self-select with people being a bit more aware of the data and how that works?
Well, I think that’s a two edged sword, frankly. The general cryptocurrency or blockchain community is pretty clued up about lots of things. The problem we have, to a certain extent, is that we are not just about techno this and the next thing, we’re a country coin and it says it on the tin: Scotcoin.
As a result we have lots of people on board who are passionate about Scotland, not just about independence but in lots of ways; it’s a wonderful country and they’re proud to be Scottish. That sometimes leads to some issues. My job, if you like, is to make sure people understand what they're doing and they’re able to understand why they do it and dare I say it, I’ve been doing quite well at it.
There’s obviously other country based coins, Iceland and Catalonia for example. The Iceland coin came about from a lack of freedom of movement from their own currency. The Catalonia example may be more relevant for us because from the beginnings of it, it’s been a form of self identity and sovereignty. How much, still, is Scotcoin about supporting a nationalist ideal?
You’re not the first person to ask me that, everyone always asks that. It’s perfectly true that if Scotland won independence, they would need some form of currency to trade if everything fell apart. My attitude is slightly different. In a way, I don’t mind if Scotland is independent or not, it's up to the people of Scotland to decide which way they want to go.
What I would like, very much, is for all the people in Scotland to be better off. And cryptocurrency, without any shadow of a doubt has a place in making people better off in different ways. The two things I always rant about in these situations is that, firstly, if you want to transfer value, which is what the Blockchain is really about and what cryptocurrencies really do as the main function - apart from holding value - the cost of transferring, say, a million pounds to Africa is about 20 or 30,000 quid [by standard bank transfer].
So that’s quite a lot. We can do that for $150 [USD] with bitcoin but normally it’s a couple of dollars. You have a big incentive to make that work first of all and save quite a lot of money.
In fact, in the Philippines they're working on a system where all the Filipinos who work all over the world can send money back using bitcoin and the result of that is that they can save the economy 1.5 billion dollars a year, which is a lot of money and is worth having.
The other thing that I really, really like about cryptocurrency is that it's targetable. Say, you had a person and you wanted them to have a night’s accommodation somewhere, you can make it so he can only spend that money in a particular place or at a particular venue.
A lot of people would say that’s against freedoms and it might well be but there are reasons for doing that. Do you want your money siphoned off by a corrupt government or do you want it to go directly to the people that dig the wells in Africa? So, there is a lot of that and it’s a really, really huge use of the coin as well.
I believe, correct me if I’m wrong, one of your ambitions is to offer the IP and ecosystem to the Scottish government?
We’ve done that. About 18 months ago we offered them the system and we started having a dialogue with them and we’re still having a dialogue with them. They’ve never said “no, we’re not interested” so we’re assuming they might be. There are a lot of good reasons for them to have it, just because it’s a good thing to do. Whether they wish to continue to do it or not is entirely up to them, of course.
Does that go as far as being a central bank issued digital currency? There are only a handful of those around the world. Is that the big ambition, to go as far as that?
I believe that there are a lot of plus points to digital currencies. At the moment, the world has changed completely from what it was. We’re talking in the midst of this covid carry on. There is a reason for holding cryptocurrency, beyond just interest in doing so. All the money that has been printed across the world, there are billions and trillions of it, god knows how many trillions of Dollars, Euros and Yen and anything you can think of. That will have an impact on inflation over time. But there’s a point about this because in 2008 when we had a similar situation of money being printed all over the place, none of the money went to the people.
What it did was, it went to the banks and the banks used it to fill all the holes in their enormous dark holes they created with all their stupid finaicial things. As a result, we didn’t get the inflation we would have expected from classic economics, all this huge increase in money and money chasing too few goods, but it didn’t happen like that.
This time is quite different. I was having a meal yesterday lunchtime and I got 50% taken off it for no apparent reason, it was dirt cheap anyway. But that’s cash that is coming directly to the consumer and that’s only one instance.
In America everyone has had $1,000 or $2,000 or whatever it is, but that money is going directly to the people. Those people are going to spend it, it’s different from giving it to the banks. The banks won’t spend it, they’ll use it for their own purposes but people will and that is, without any shadow of a doubt, going to create inflation longer term.
Another great thing about cryptocurrency is that it’s slightly deflationary. If you have a dollar today, as an example, then you have a dollar in ten trillion dollars and in six months it's a dollar in 15 trillion dollars. But if you have bitcoin today, then you have one in 21 million and in 100 years time, you’ll still have one in 21 million. These are things which people are aware of but they’re not necessarily things where they realise what the implications are.
People should consider having a little bit of cryptocurrency just in case.
This extract has been edited for length and clarity. Watch the full interview below and follow us on LinkedIn.