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(Pocket-lint) - The tiny island of Alderney wants to become the first jurisdiction to mint physical Bitcoin, according to a new report.

The Financial Times has seen documents that reveal Alderney, a three-mile long island and one of the British Channel Islands off the coast of France, has been developing plans to issue physical Bitcoin since the summer. The alleged plans are in partnership with the UK’s Royal Mint and would make the physical Bitcoin a part of the Royal Mint’s commemorative collection.

READ: What is Bitcoin?

The physical Bitcoin collection would include limited edition coins and stamps, and they could have a gold content worth £500. Should the exchange value of the currency collapse, holders could melt and sell the gold content. That's an interesting aspect of the plans, especially considering the hype surrounding Bitcoin.

The price of a single Bitcoin reached $1,242 on Friday. That spike has caused many critics to warn of a "speculative bubble", as noted by The Financial Times. Still, despite all the eyebrow raising, investors are scrambling to get a piece of the action. Even Sir Richard Branson, CEO of Virgin Group, announced last week that he was an investor and that Virgin Galactic would begin accepting Bitcoin. 

READ:Virgin Galactic now lets you use Bitcoin to pay for flights into space

E-commerce is important to Alderney, as it hosts the domain name registry for both it and the larger island of Guernsey, under which it is administered, and more than a dozen gambling website operators. The island even has a full regulatory authority in operation. Because of the strong e-commerce economy, and the ever-rising value of Bitcoin, Alderney wants to become the first international centre for Bitcoin transactions.

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Writing by Elyse Betters. Originally published on 30 November 2013.