I assume this decision was taken after looking at their competitor: Bitcoin. The Mint could easily make their own version of Bitcoin/Litecoin and launch their own cryptocurrency for about $200 right now.
The person in charge of MintChip gave an interview in 2013 where they responded to a question about how much the MintChip has cost with "I don’t know if I can share that, but we’re serious. I don’t think I want to put out numbers."
I'm glad the Royal Mint has realized they can't compete with a global open-source movement.