While many aspects of cultures worldwide are shifting from physical to digital, cash remains essential to financial systems thanks to its unique benefits, and these are driving the development of banknotes for the cryptocurrency Bitcoin.
Invented in 2008 and in use since 2009, Bitcoin is widely considered to be the original cryptocurrency. As a decentralised digital currency—not backed by a central bank or run by a single administrator—it is exchanged by users via a peer-to-peer network that does not require intermediaries. Recognising the value added by physical cash—from privacy and security to familiarity and ease of use—a team of financial experts is in the process of creating ‘crypto-backed banknotes’.
Cash is a key touchpoint in the brand of money. It is certainly the most relatable part of central banking, and the design of circulating banknotes is a major factor in the public’s trust of the financial system.
The chief architect of the Bitcoin banknote is Noteworthy, founded with the goal of developing ‘greater transparency and security’ in the use of Bitcoin, harnessing the design features of modern cash that make it more secure and harder to counterfeit than ever before.
Alongside these efforts, Independent Currencies is also championing cash for Bitcoin and other cryptocurrencies. On its Bitcoin Banknote website, it explains that physical money can protect cryptocurrencies from the risk of fraud by using the same security features that allow verification of a genuine banknote.
Cash is the physical production of trust. The fiat financial system is built on confidence, and the visual and product branding for that confidence is the production of banknotes.
Bitcoin Banknote observes ‘the privacy of cryptocurrency is a myth—all transactions are visible. Cash, on the other hand, is truly private.’ Beyond this, it cites the familiarity of physical money as a particular benefit for a currency that, for many, is hard to understand. It also observes the ‘art’ of cash, noting that it is among the world’s ‘most personal yet highly-crafted’ products.
Cash has clear advantages, in its practicality, in its ideals and the quality of its brand-making. These advantages are all to cryptocurrency’s benefit.”