The leader of a vital banking organization called BIS, Agustín Carstens, doubts cryptocurrencies. He thinks they may be unable to replace regular money, also known as fiat currency.
In an interview with Bloomberg on Feb 22, Carstens expressed his skepticism about cryptocurrencies and their sureness as money. He highlighted the importance of having trustworthy and regulated financial systems. He points out that the drop in cryptocurrency prices last year served as proof of this.
Carstens admits that cryptocurrencies became very popular, and many thought they could replace regular money. However, he doesn’t believe that the technology used for cryptocurrencies makes them trustworthy as a type of money.
“A few years ago, crypto assets and cryptocurrencies were, in a way, put us an alternative to fiat money. I think that battle has been won; the technology doesn’t make for trusted money. The most important aspect is for these activities not to have a systemic impact,”
Carstens emphasized the urgent need to create rules for using cryptocurrencies. He thinks it’s essential to ensure that the exchange doesn’t cause problems for the financial system.
Carstens mentioned that if something like the FTX failure happened again, it could cause a big problem for the entire financial system. Because of this, he wants the Group of 20 countries to make a strong statement and work together to ensure that cryptocurrencies are appropriately regulated.
Carstens: Stricter Rules for Stablecoins, Banks Can Hold Cryptocurrencies
Before, Carstens asked the people who make rules to pay close attention to stablecoins. He thinks the authorities must ensure stablecoins don’t hurt those using them. Despite BIS not liking cryptocurrencies, they said banks can now keep up to 1% of their money in the exchange, such as Bitcoin (BTC).
The paper discussed many problems with the crypto and blockchain industries, moreover, also like the high fees and network problems that caused the market to split.
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This article conveys general information, and the opinions expressed should not be considered personal advice for any individual or specific security or investment product.
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