Mint Chip set for testing as Canadian digital currency

by | Sep 20, 2013 | Biz/Tech

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By Lily Tran and Kateryna Barnes

The Royal Canadian Mint has confirmed to Humber News on Friday that they will be testing Mint Chip technology.

After holding an event called the Mint Chip Challenge in 2012 to further develop the technology, The Royal Canadian Mint said they’re near ready to begin testing.

According to a report in the Financial Post this week, the Mint Chip could begin testing as soon as the end of this year.

The chip, which looks much like a SIM card, is placed inside a smart phone and allows payment similarly to a PayPass service, but does not connect to a bank account.

Alex Reeves, senior manager of communications at the Royal Canadian Mint, told Humber News via email that the project was ongoing and that the Mint Chip could be addressed at a later date. However, Reeves did confirm the technology would be tested in a closed environment with Mint employees.

No plans for public test

No date for the testing has been set, but Reeves said that a public test is not imminent at this point.

The Royal Canadian Mint said the Mint Chip would not replace cash, debit or credit cards and the project is still in its preliminary stages, the concept of digital currency is here to stay.

Bitcoin, already a popular form of digital currency, has been slowly developing into something that’s being used by business and consumers.

Michael Perklin, a member of the Board of Directors for the Bitcoin Alliance of Canada, said the Mint Chip won’t necessarily be a competing currency.

“I always encourage new technologies,” said Perklin. “I hope that the two can work with each other.”

The difference between Bitcoin and the Mint Chip is that Bitcoin has no central regulation. The Mint Chip will work as a standard form of currency — one Canadian dollar will equal one dollar with the Mint Chip technology — Bitcoin is a consistently fluctuating currency.

‘Just another gimmick’

However, the reality is that a new, digital currency may not appeal to everyone.

“It’s already been done with debit and credit [cards],” said Richard Kingston, program coordinator of financial planning at Humber.

“I see no use for it.” Kingston said digital currency is “just another gimmick and businesses already have to deal with enough as is.”