The launch of the CZC is aimed at supporting internet businesses in the Czech Republic.
50% of the total virtual currency allocation of 100 million coins will be reserved for Czechs and the coins will be allocated according to a registration system and will later be traded on international virtual currency exchanges. The remainder of the coins will be released afterwards and will be available to any interested parties.
The Czech Ministry of Finance has kept silence to requests for comments on whether the virtual coin will encourage tax evasion.
The system is based on litecoin, a peer-to-peer cryptocurrency and open source software project that enables transactions among users and is not controlled by any central authority.
Ladislav Faith, the head of the project, has also stated that Czech Crown Coin was inspired by auroracoin, a similar systems now being rolled out in Iceland. The coins will be made available to users in three phases starting in September 2014.
Faith has also disclosed that the servers have already been under attack by hackers from Russia, the Czech Republic and other countries, but there has been no harm done to the CZC ecosystem.
The Czech central bank said virtual currencies in fact aren’t currencies at all and that they present risks to consumers as they are not backed by any institutions. However, such electronic barter systems do not break any laws as long as they remain in the digital realm without issuance of any physical coins, banknotes or tokens.
The central bank said the name of the virtual currency may cause confusion among citizens because it resembles the English translation of Ceská koruna, the official Czech currency.
Every day we send out a free e-mail with the most important headlines of the last 24 hours.
Subscribe now