The current manager of the Bank for International Settlements, ensures that central banks must control Bitcoin and all digital money.
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At the height of the cryptocurrency boom, the manager of the Bank for International Settlements (BIS) , AgustÃn Carstens , warned about the dangers of investing in them. The former finance secretary warned that Bitcoin is increasingly vulnerable and could completely collapse .
Yesterday, January 27, during the policy seminar of the Hoover Institution , the Mexican economist said that Bitcoin is a speculative asset, not money .
â€œInvestors should be aware that Bitcoin can completely crash. Scarcity and crypto alone are not enough to guarantee exchange, “ explained Carstens , adding that ” Bitcoin is increasingly vulnerable .
The also former governor of Banco de MÃ©xico , affirms that central banks must control the issuance and management of digital money . Consider that they have the financial structure to guarantee the stability of the cryptocurrencies .
â€œFor digital money to exist, the central bank must play a fundamental role, guaranteeing the stability of the value, ensuring the elasticity of the aggregate supply of said money and overseeing the general security of the system. Such a system must not fail and cannot tolerate serious errors , â€�Carstens said.
– Bitcoin (@Bitcoin) January 29, 2021
The BIS manager said that other private stablecoin projects, such as Facebook’s , are more credible than Bitcoin , but need to be regulated.
“In general, private stablecoins cannot serve as the foundation for a sound monetary system ,” he said. â€œBut to remain credible, they must be strictly regulated and supervised. They must build on the foundations and confidence that the existing central banks give them and, therefore, be part of the existing financial system .
For now, many countries are targeting Central Bank digital currencies (CBDC) . In fact, 86% of major central banks are actively exploring CBDCs , according to a recent BIS survey.
Carstens indicated that national CBDCs would be used in various ways, such as the transmission of monetary policy and the management of interest rates. He explained that they should be complementary to the existing cash system , as completely replacing all bank accounts and cash with digital money is “undesirable” and “unrealistic .”
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