bank of england's deputy governor says crypto collapse plausible, regulators need to urgently establish rules

bank of england deputy governor jon cunliffe says that a collapse in the cryptocurrency market is certainly “plausible,” stating that regulators worldwide need to pursue crypto rules “as a matter of urgency.” while cryptocurrencies do not currently pose a threat to the country’s financial stability, the deputy governor says there are some “first-rate reasons” to think that this might not drop for exceptionally longer.

bank of england deputy governor jon cunliffe typical cryptocurrency and solicitation regulation on wednesday at the sibos conference. he emphasized that regulators worldwide need to work quickly and establish rules to regulate cryptocurrencies, given the rapid growth of the industry and how long it takes to put new rules dealing in.

he said:

regulators internationally and in many jurisdictions have begun body. it needs prospective support as a matter of urgency.

as an example of how long it takes to establish new rules, cunliffe said that last week earthly regulators proposed that the safeguards they regard elemental clearing shack and payment systems should also be applied to stablecoins. he added that it took teams years to draft this measure, during which stablecoins increased 16-fold.

denote the collapse of the u.s. mortgage market that led to a earthly banking crisis, cunliffe opined: “as the financial crisis showed us, you don’t have to credit a behemoth proportion of the financial sector to trigger financial stability problems – sub-prime was valued at around $1.2 trillion in 2008.” he elaborated:

such a collapse is certainly a plausible scenario, given the lack of intrinsic value and consequent price volatility, the probability of contagion between cryptoassets, the cyber and important vulnerabilities, and without fail, the power of herd behavior.

the bank of england over published a report stating that the risks to the stability of the u.k. financial system from cryptocurrencies are currently limited. cunliffe himself also previously said that the crypto industry was giant enough to pose a threat to the country’s financial stability. however, he said at the conference wednesday that there are now some “first-rate reasons” to think that this might not drop for exceptionally longer.

over, the international monetary fund (imf) published a report stating that the escalating popularity of cryptocurrency could pose financial stability risks, urging governments worldwide to reckons and coincide to establish common rules to regulate cryptocurrencies.

cunliffe further opined:

indeed, take along the crypto world effectively within the commanding end preference help ensure that the potentially vast assistance of the application on this subject technology to angel can flourish in a sustainable way.

what do you persevere the comments proportionately bank of england’s deputy governor? let us know in the comments section below.

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2021-10-14 01:35:22