New Digital Currency Hullcoin Being Created By UK Hull City Council
Should voluntary work be paid with gratitude or with actual money? U.K’s Hull City Council, is creating a digital currency called Hullcoin which will be used to donate to people who do voluntary work.
Hullcoin to ‘Tackle Poverty’
Hullcoin will be used to “tackle poverty” and help the economy. People who do voluntary work will be rewarded with Hullcoin as a payment. This digital currency can be used to pay rent, council tax, buy goods and even services. This initiative is aimed to help out struggling residents.
Workers in the Council are trying to work out deals that could allow Hullcoin to be used at high-end shops such as Asda.
Will Hullcoin be Taxable?
Considering the fact that Bitcoin has been facing many regulatory hurdles, one might wonder if Hullcoin will also be subjected to such attention. However, according to the Telegraph, Hullcoin will not be taxed or affect any benefit claims. This is due to the simple fact that virtual currencies are not subjected to regulations such as traditional currency by the Department for Work and Pensions, or by the HMRC.
The council’s Financial Inclusion Support officer, Dave Sheperdson said that problems will only happen if people take to online exchanges to convert Hullcoin into cash. He said,
“The idea is that we’ll provide it to people on low incomes for them to pay for things that they wouldn’t otherwise be able to pay for, particularly food and fuel. It’s a very different sort of project.”
Just like Bitcoin and other digital currencies, Hullcoin will also be mined into existence and stored into a digital wallet. In order to pay for the mining hardware, Shepherdson said that it would take around ten to twelve weeks for the council to be able to mine enough coins to do so. After these weeks, the actual project will be hoped to commence.
The council is mining with a computer that has two Sapphire R9 290X graphic cards. Shepherdson said,
“We’re printing our own money, I suppose.”
This project gives the Council the ability to make currency that will be accepted by a group of individuals. If the project proves to be successful, it will become a company that will act as a “digital bank of Hull”. Not only that but it will also allow the Council to provide other virtual currencies to its community.