The Bank of England, more specifically Dave Ramsden who is a deputy governor for markets at the major financial institution, says that crypto assets including Bitcoin are too volatile to meet the principles of currency. The following altcoin news will provide you with more information about his stance towards crypto.
Dave Ramsden cited the Financial Policy Committee research, stating that the high volatility and high costs of the crypto transaction settlements make cryptocurrencies such as Bitcoin less practical to be used as a currency. Bitcoin is still only 10 years old which makes the rest of the crypto market younger. Other assets on the market such as Ethereum also show signs of increased volatility so investors see it as a risky investment.
Despite the negative stance on the Bank of England, the CEO of PayPal and Xapo Wences Casares, is a strong supporter of Bitcoin for many years now and explained the chances of BTC succeeding:
“In my (subjective) opinion those chances of succeeding are at least 50%. If bitcoin does succeed, 1 bitcoin may be worth more than $1 million in seven-to-10 years. That is 250 times what it is worth today.’’
Other industry executives and investors as reported in the latest cryptocurrency news, agree that there is a chance for cryptocurrencies to fail in the long run if they don’t gather the sufficient adoption from the users or if they don’t evolve into practical currencies as what Dave Ramsden believes crypto is not.
The deputy governor of the Bank of England also pointed out:
“Just a year ago, the Financial Policy Committee looked at crypto assets in some details supported by the fintech hub. The conclusions of the FPC are that crypto assets are too volatile to be a store of value and we’ve seen that in terms of their subsequent movements through last year. And also, as a medium of exchange, the costs of transactions were very expensive so it didn’t really satisfy those basic principles of being a currency.”
As the custodial services which support crypto assets improve, the institutional investors will feel comfortable into committing to the asset class which will later lead into stabilizing the entire market. The market cap of all cryptocurrencies reached about $170 billion but it’s only a fraction of the market cap of the gold as a store of value for example. The maturation of the industry could influence the current stance of the Bank of England towards cryptocurrencies and their possibilities.
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