“Crypto cannot be used as money,” says International Bank

If it is up to the Bank for International Settlements (BIS), crypto cannot be used as money. According to the organization, this has to do with the “inherent shortcomings” of cryptocurrencies. The organization, made up of the world’s largest central banks, said this in a report addressed to the G20, the twenty largest economies.

“Crypto has failed”

The report argues that despite the interest of millions of users worldwide, crypto has “failed to deliver innovation for the benefit of society.” Harsh words from the organization that is clearly not a fan of the crypto industry. G20 finance ministers are meeting in India this week.

BIS believes that crypto is still a very isolated world and “that it does not fund real economic development”. Also, “inherent structural deficiencies would render (crypto) unsuitable to play a significant role in the monetary system,” the report said.

The report only points to the shortcomings of the crypto sector. That’s what the FTX and Terra fiascos are called. Other security concerns such as the prominent hacks and back pulls are also addressed in the report. Technically, current crypto projects are also incapable, according to BIS. Scalability is an issue mentioned.

Although the criticism of the crypto sector is not entirely misplaced, the report does not say a good word about the industry. The potential potential of the crypto industry does not seem to be an important factor in BIS’s analysis.

Criticism of BIS no surprise

The criticism from BIS is no surprise. Crypto is a direct competitor of the existing financial system. Losing financial control is every central bank’s nightmare. The BIS would therefore not benefit at all from further development of the crypto industry.

Whether the BIS’s plea will make a big impression is the big question. Many governments and jurisdictions seem to want to help the crypto sector in the saddle. Hong Kong is a good example of this. The European Union is also busy establishing clear rules for the crypto sector.

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