Wednesday, December 8, 2021
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Bank of England Deputy Governor, Jon Cunliffe Says Crypto Is Reaching That Point Where It Will become A Threat To Financial Stability

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The Deputy Governor of the Bank of England Jon Cunliffe called Bitcoin and crypto elevated threat to financial stability but showed support for the Central Bank digital currencies.


 

Jon said that of all cryptocurrencies, Bitcoin poses the greatest risk to the global financial system. He explained that at the moment digital assets are not dangerous for the financial market, but as cryptocurrencies are developing and are rapidly being introduced into various fields they could soon pose grave risks to financial stability.

Cunliffe said:

“Cryptocurrencies are approaching the point where they can pose a major threat to the world of finance. Regulators should think well about this and clarify crypto regulations.”

 

He believes that, unlike conventional cryptocurrencies, stable coins pose less of a threat, as they are tied to fiat currencies or physical commodities (like gold or oil), which curbs their volatility. However, even stable cryptocurrencies may fall far short of regulatory compliance.

Cunliffe is positive that central bank digital currencies (CBDCs) have high potential. The Bank of England is actively exploring the possibility of introducing the digital pound sterling, because in the modern world, the methods of conducting transactions are changing and moving to a digital format.

He also revealed that businesses such as Facebook, are ejecting their own stable coins, such as Diem.

“There are proposals for new players who are not banks, including some of the big tech platforms and some of the social media platforms, to come into the world and issue their own money. But I think that those proposals don’t yet exist at scale, so I don’t think we’re behind the curve here,and central banks are not lagging behind them and are working hard to create government stable coins.”

Next year, the Bank of England and the UK Treasury will begin a public discussion on the digital pound’s possibilities to see if it makes sense for organizations and individuals to use Digital Pound on a wider scale.

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Albert Brownhttps://thecryptobasic.com/
Albert Brown is a crypto journalist interested in technology and technical innovations. He has been in crypto since 2017. Believes that blockchain and cryptocurrencies have a potential to transform the world in the future in many of its aspects. Holds major cryptocurrencies and has written for multiple crypto media outlets. His articles have been quoted by such crypto influencers as Tyler Winklevoss, John McAfee, CZ Binance, Max Keiser, etc.

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