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Current cryptocurrencies unlikely to last, Bank of England governor says


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Current cryptocurrencies unlikely to last, Bank of England governor says

By David Milliken

 

FILE-PHOTO-Bank-of-England-press-conference.jpg

FILE PHOTO: Chief Executive of the Financial Conduct Authority Andrew Bailey speaks at a press conference at the Bank of England in London, Britain February 25, 2019. Kirsty O'Connor/Pool via REUTERS/File Photo

 

LONDON (Reuters) - No existing cryptocurrency has a structure that is likely to allow it to work as a means of payment over the long term, Bank of England Governor Andrew Bailey told an online forum hosted by the Davos-based World Economic Forum on Monday.

 

“Have we landed on what I would call the design, governance and arrangements for what I might call a lasting digital currency? No, I don’t think we’re there yet, honestly. I don’t think cryptocurrencies as originally formulated are it,” he said.

 

Bitcoin, the best-known cryptocurrency, hit a record high of $42,000 on Jan. 8 and sank as low as $28,800 last week, far greater volatility than is found with normal currencies.

 

“The whole question of people having assurance that their payments will be made in something with stable value ... ultimately links bank to what we call fiat currency, which has a link to the state,” Bailey said.

 

The BoE, like the European Central Bank, is looking at the feasibility of issuing its own digital currency. This would allow people to make sterling electronic payments without involving banks, as is currently possible with banknotes, and would in theory help avoid the volatility that renders bitcoin impractical for commerce.

 

Bailey said the appropriate level of privacy for digital currencies was likely to be hotly debated and was potentially underrated as a challenge in setting one up.

 

“This is a big one that is coming on to the landscape, the whole question of a privacy standard for transactions made in any form of digital currency, and where the public interest lies,” he said.

 

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-- © Copyright Reuters 2021-01-26
 
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1 hour ago, jobsworth said:

Bitcoin is no more silly than gold or diamonds.

We use them as money,, which is a means of exchange, a measure of wealth and a store of value.

Bitcoin will continue as long as the internet continues and Iceland continues to supply cheap electricity to power the data mining.

Central banks and countries don't like Bitcoin because they have no control over it and so can't control money laundering.

 

Gold is way less volatile than Bitcoin and diamonds are worth next to nothing. The only reason they command the price they do is because 99% of what comes out of the ground each year ends up in a vault somewhere to artificially keep the price up. Having said that, large diamonds that are perfect are definitely worth the price they command because they’re rare. If iahe the Choice between crypto and gold, I’d go for gold any time of the day! 

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Just now, rwill said:

Banks are already starting to use blockchain for transfers and recording.  What the governments don't like is the inability to create tokens at will like they are all doing with their fiat currencies.  

 

don't worry, they can emit "banknotes" instead

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The man is right
as regulation comes in, Crypto will be seen as illegal securities
it is happening already
Crypto "trading" is nothing more than gambling on worthless tokens

however this will not apply to Bitcoin
Sadly the guy does not even know what Bitcoin is
(i expect many in here dont either)
as only BTC has hit $42K
and BTC is NOT Bitcoin.

Governments will issue fiat tokens,
but they will be issued on the Bitcoin network
as it is the only network that scales to serve billions of people

There will be only ONE network

Edited by patman30
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25 minutes ago, patman30 said:

The man is right
as regulation comes in, Crypto will be seen as illegal securities
it is happening already
Crypto "trading" is nothing more than gambling on worthless tokens

however this will not apply to Bitcoin
Sadly the guy does not even know what Bitcoin is
(i expect many in here dont either)
as only BTC has hit $42K
and BTC is NOT Bitcoin.

Governments will issue fiat tokens,
but they will be issued on the Bitcoin network
as it is the only network that scales to serve billions of people

There will be only ONE network

 

I agree with almost all statements above except the last one - Bitcoin network is incapable of serving billions of people currently and highly unlikely it ever would be.

 

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The remarkable thing is how clearly all the main arguments against Bitcoin collapse once you actually understand what it is and what it is not.

I dismissed it for many years - which, obviously, I regret ???? - but when I finally took the time to understand what was happening to the economy as a whole, it became the most obvious investment I have ever made.

I never forget, however, how crazy Bitcoin once seemed to me and I accept that it will be years before most people undestand it. In March, I posted on this forum, in a thread about where to invest as the markets crashed, explaining why the then price of $5K was a bargain (I also argued that Apple was a good deal at $60 for anyone who preferred stocks to crypto). Even as I wrote, however, I knew that most members here were not ready to think calmly and, instead, converted their investments into cash. Terrible mistake.

I do think this year will be a tipping point for many people, simply because the inflation and taxation aftershocks of the pandemic will force them to think about alternatives.

 

Edited by Poet
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7 hours ago, Brickbat said:

The young geeks who are involved in Cryptoland are way too smart for these old farts who are only afraid of losing their control. 

The old farts control fiat currency, which, if they choose,  they can "print" in unlimited quantities to hire other (non-libertarian/crypto-anarchist) young geeks to mess with "Cryptoland", in what might become "trial by combat"*, whether Bailey realises it or not.

 

* (c)  Rudy Giuliani

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2 hours ago, onebir said:

The old farts control fiat currency, which, if they choose,  they can "print" in unlimited quantities to hire other (non-libertarian/crypto-anarchist) young geeks to mess with "Cryptoland", in what might become "trial by combat"*, whether Bailey realises it or not.

 

* (c)  Rudy Giuliani

The old farts are dying out and the young ones are switched on. It took ages for the internet to catch on. Even longer for the simple act of medics having to wash their hands before operations

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On 1/27/2021 at 11:10 AM, fdsa said:

I agree with almost all statements above except the last one - Bitcoin network is incapable of serving billions of people currently and highly unlikely it ever would be.

Please do not be offended by this
BUT
you simply do NOT know what bitcoin is.
Please do read my comment again
BTC is NOT bitcoin

once you understand why
we can discuss bitcoin properly

No, i am not here to educate you or argue with you
i will not tell you what is, just for you to say it isnt.
DYOR????

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6 hours ago, patman30 said:

Please do not be offended by this
BUT
you simply do NOT know what bitcoin is.
Please do read my comment again
BTC is NOT bitcoin

once you understand why
we can discuss bitcoin properly

No, i am not here to educate you or argue with you
i will not tell you what is, just for you to say it isnt.
DYOR????

 

don't drink and type, bro. I'm DMOR since 2012 and know what I say.

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On 1/27/2021 at 7:26 PM, Brickbat said:

The old farts are dying out and the young ones are switched on. It took ages for the internet to catch on. Even longer for the simple act of medics having to wash their hands before operations

 

Those who worked on the Bitcoin client at the beginning were certainly not youngsters
 

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