Bank of England governor rejects bitcoin’s resemblance to money

June 16, 2021

Bank of England governor rejects bitcoin's resemblance to money

Bitcoin has no value, but stabelcoin could have a niche in the financial system. Andrew Bailey, governor of the Bank of England, said.

The governor noted the dangers posed by decentralised assets such as Bitcoin, as well as interest in Stablecoin and national digital currencies (CBDCs).

"Stable coins have collateral. Bitcoin doesn't have it, it's not the equivalent of money. The term 'cryptocurrencies' is not accurate," the official explained.

Bailey recalled that the Bank of England is monitoring the actions of major technology companies exploring the possibility of issuing global stablcoins. He added that the Financial Policy Committee had outlined its expectations for their regulatory principles.

According to the central banker, CBDCs could play an "important role in maintaining and expanding access to fiat by retail users".

Recall that in June, the Bank of England said it was necessary to apply bank payment regulations to stablcoins.

At their last meeting, the leaders of the Group of Seven (G7) countries confirmed that no global stablecoin project should be launched until full compliance with legal, regulatory and supervisory requirements has been achieved.

Earlier, Fed chief Jerome Powell noted the priority of regulating stablcoins, which could one day become systemically important.

In a report on the international role of the euro, the ECB warned of problems for central banks in the absence of their own CBDCs.

In May 2020, the regulator looked at three scenarios for the use of Facebook's curated digital currency Diem. Analysts have estimated that the amount of funds committed to a global version of the stable currency could range from €152.7bn to €2.93 trillion.

In May 2021, Diem announced plans to launch in the US with a US-only focus.

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Hi there, my name is Zalman Weinberg. I'm enthusiast with over 7 years of experience in cryptocurrencies and blockchain. Professional Trader providing Blockchain solutions to Startups and Enterprises. Expert in all cryptocurrency exchange APIs (BitMEX, Bittrex, Binance, Bitfinex, Kraken, Poloniex, Gdax etc.). I have also worked with multiple Forex broker APIs.

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