Category: Bank of England

Bank Of England Will Scramble To Buy BTC Before It Hits $1 Million, Says Bitcoin Maximalist

Bank Of England Will Scramble To Buy BTC Before It Hits $1 Million, Says Bitcoin Maximalist

Bitcoin expert Max Keiser has said that the Bank of England (BoE) will scramble to buy Bitcoin before the digital asset trades at $1 million.
His comments come after Bank of England’s deputy governor for financial stability, Jon Cunliffe, warned that cryptocurrencies could spark a global financial crisis unless tough regulations are introduced. Although regulators in many countries have started putting policies in place to manage the rapid growth of cryptocurrencies, Cunliffe said this must be pursued as a matter of urgency.
Bank of England Warns Against Crypto
The deputy Bank of England governor has called for strict regulations on Bitcoin and other cryptocurrencies. According to the Guardian, Cunliffe has played a central role in monitoring cryptocurrencies over recent years as an adviser to the G20’s financial stability board and the central banks’ overarching advisory body, the Geneva-based Bank of International Settlements.
Related Reading | Bank Of England Seeks To Strengthen Cryptocurrency Regulations
In a speech on Wednesday, October 13, Cunliffe compared the growth rate of the crypto market, from $16 billion five years ago to $2.3 trillion today, to the $1.2 trillion subprime mortgage market before the 2008 financial crash. He said there was a probability that financial markets could be rocked in a few years by an event of similar magnitude.
“When something in the financial system is growing very fast and growing in largely unregulated space, financial stability authorities have to sit up and take notice,” he said.
He also spoke about the majority of crypto-assets having no intrinsic value and could be worthless overnight. He stated emphatically how the crypto world is beginning to connect to the traditional financial system even though the space is still largely unregulated.
The banking chief added that there were “Financial stability risks currently are relatively limited, but they could grow very rapidly if, as I expect, this area continues to develop and expand at pace. How large those risks could grow will depend in no small part on the nature and on the speed of the response by regulatory and supervisory authorities.”
Related Reading | Bank of England Governor Still Isn’t a Fan of Bitcoin
His comments are similar to those of Bank of England Governor Andrew Bailey. In May, Bailey called crypto dangerous and warned that investors should be prepared to lose all their money due to the digital assets’ lack of intrinsic value.
Bitcoin Expert’s Response
Bitcoin expert Max Keiser responded to the Bank of England’s deputy governor’s recent warning about cryptocurrencies in a statement to Express.co.uk.
He said, “Bitcoin is designed to trigger a meltdown of the current fiat money banking system. This is a mathematically guaranteed outcome.”

BTC trading at over $60.8K | Source: BTCUSD on TradingView.com
Keiser implies that the BoE is grieving because Bitcoin killed central banks. “Bitcoin killed central banks. The Bank of England is in the second stage of the five stages of grief, the anger phase.”
He pronounces that the Bank of England will eventually consider adopting Bitcoin.
“The bargaining phase will be their central bank digital currency stage and when that fails comes depression as the price tops £363,000 ($500,000) and then acceptance with the Bank of England scrambling to buy Bitcoin before it tops £727,000 ($1million) per coin,” Keiser says.
Featured image by Proactive investors, Chart from TradingView.com

Economics Professor Warns ‘Cryptocurrencies May Contribute to Monetary and Financial Instability’

Economics Professor Warns ‘Cryptocurrencies May Contribute to Monetary and Financial Instability’

Cornell University’s professor of economics and former head of the IMF’s China division, Eswar Prasad, has warned that “Cryptocurrencies may contribute to monetary and financial instability.” He added that the risk is amplified if the industry is unregulated and lacks investor protection.
Economist Sees Crypto Posing Risks to Financial Stability
Eswar Prasad, the Nandlal P. Tolani Senior Professor of Trade Policy and professor of economics at the Charles H. Dyson School of Applied Economics and Management at Cornell University, shared his view on cryptocurrency in an interview with CNBC, published Wednesday.
Prasad is also a senior fellow at the Brookings Institution, where he holds the New Century Chair in International Economics, and a research associate at the National Bureau of Economic Research. He was previously chief of the Financial Studies Division in the research department of the International Monetary Fund (IMF) and head of the IMF’s China division.
He said:
Cryptocurrencies may contribute to monetary and financial instability, especially if they were to spawn a large and unregulated financial system that lacks investor protection.
His statement echoes a report recently published by the IMF cautioning that the rising popularity of cryptocurrency could pose a threat to financial stability. Moreover, the deputy governor of the Bank of England, Jon Cunliffe, said this week that regulation is urgently needed since the crypto industry is growing rapidly, and there are some “very good reasons” to think that it could pose risks to the country’s financial stability in the future, even though the risks are currently limited.
Professor Prasad was also asked how cryptocurrencies could widen economic inequality. “Cryptocurrencies and their underlying technology hold out the promise of democratizing finance by making digital payments and other financial products and services easily accessible to the masses,” he replied. “But because of existing inequalities in digital access and financial literacy, they could end up worsening inequality.”
In addition, he emphasized that “any financial risks arising from investing in cryptocurrencies and related products might end up falling especially heavily on naïve retail investors.”

The Cornell professor of economics also discussed central bank digital currencies (CBDCs), stating:
I think central bank digital currencies are the way of the future. But every central bank will want to make sure that its money is not used for illicit purposes, so transactions will be auditable and traceable.
However, Prasad noted that “if every payment you make, including for a cup of coffee or for a sandwich, can be seen by a government agency, that’s an uncomfortable proposition.” The economist concluded: “You could, in a more dystopian world, have the government deciding what sort of goods and services its money can be used for.”
Do you agree with the economics professor? Let us know in the comments section below.

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Crypto Presents Financial Stability Concerns, Bank of England Deputy Governor Warns

Crypto Presents Financial Stability Concerns, Bank of England Deputy Governor Warns

A senior Bank of England official says that crypto could potentially be a threat to overall financial stability.
In a new speech, deputy governor Jon Cunliffe weighs the pros and cons of crypto technology. He says that while “a prospect of radical improvements in financial services” exists, current crypto applications present financial stability concerns.
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Bank of England’s Deputy Governor Says Crypto Collapse Plausible, Regulators Need to Urgently Establish Rules

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 “very good reasons” to think that this might not be the case for very much longer.
Crypto Collapse Plausible, Crypto Rules Are ‘a Matter of Urgency’
Bank of England Deputy Governor Jon Cunliffe talked about cryptocurrency and its 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 in place.
He said:
Regulators internationally and in many jurisdictions have begun the work. It needs to be pursued as a matter of urgency.
As an example of how long it takes to establish new rules, Cunliffe said that last week global regulators proposed that the safeguards they apply to systemic clearing houses and payment systems should also be applied to stablecoins. He added that it took two years to draft this measure, during which stablecoins increased 16-fold.
Referring to the collapse of the U.S. mortgage market that led to a global banking crisis, Cunliffe opined: “As the financial crisis showed us, you don’t have to account for a large 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 operational vulnerabilities, and of course, the power of herd behavior.

The Bank of England recently 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 not big enough to pose a threat to the country’s financial stability. However, he said at the conference Wednesday that there are now some “very good reasons” to think that this might not be the case for very much longer.
Recently, the International Monetary Fund (IMF) published a report stating that the rising popularity of cryptocurrency could pose financial stability risks, urging governments worldwide to step up and work together to establish common rules to regulate cryptocurrencies.
Cunliffe further opined:
Indeed, bringing the crypto world effectively within the regulatory perimeter will help ensure that the potentially very large benefits of the application of this technology to finance can flourish in a sustainable way.
What do you think about the comments by the Bank of England’s deputy governor? Let us know in the comments section below.

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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BoE deputy gov: Regulators should pursue crypto as a ‘matter of urgency’

BoE deputy gov: Regulators should pursue crypto as a ‘matter of urgency’

Jon Cunliffe, deputy governor for financial stability at the Bank of England, said the risks of a growing crypto market on the financial system are “relatively limited” at the moment but have the potential to grow very rapidly if regulators do not keep pace.In a speech to the Society for Worldwide Interbank Financial Telecommunication (SWIFT) on Oct. 13, Cunliffe said policymakers around the world have only just started to develop the framework needed to properly regulate digital assets but should pursue it “as a matter of urgency.” The deputy governor spoke about the risks that cryptocurrencies and stablecoins may pose when connected to traditional financial systems through individuals, financial institutions, hedge funds and banks.Given that digital assets are continuing to work their way into these institutions, sentiment over crypto volatility and otherwise could cause “investors to sell other assets that are judged to be risky.” Cunliffe referred to the interconnectedness of crypto and traditional finance as having the potential for a shock “transmitted through the financial system” if something were to go wrong.One of the scenarios that Cunliffe posed was if the price of an unbacked crypto asset were to fall to zero. In addition, price volatility — even seemingly among major cryptocurrencies — “could trigger margin calls on crypto positions forcing leveraged investors to find cash to meet them, leading to the sale of other assets and generating spillovers to other markets.”“Financial stability risks currently are relatively limited but they could grow very rapidly if, as I expect, this area continues to develop and expand at pace,” said Cunliffe. “How large those risks could grow will depend in no small part on the nature and on the speed of the response by regulatory and supervisory authorities.”Related: Bank of England governor issues crypto investment warningCunliffe has previously argued that England’s central bank should “issue public digital money that can meet the needs of modern day life,” implying that a digital pound may be in the BoE’s future. He is currently co-chairing a task force set up by the U.K. government to explore the rollout of a central bank digital currency.

Bank of England: Crypto Assets Pose ‘Limited’ Risks to Stability of UK Financial System

Bank of England: Crypto Assets Pose ‘Limited’ Risks to Stability of UK Financial System

The Bank of England says that crypto assets pose “limited” direct risks to the stability of the country’s financial system. “Cryptoasset and associated markets and services continue to grow and to develop rapidly. Such assets are becoming increasingly integrated into the financial system,” the U.K.’s central bank described.
Crypto Poses Limited Risks to UK’s Financial Stability
The Bank of England’s Financial Policy Committee (FPC) published the October edition of the “Financial Stability in Focus” report Friday.
The Financial Policy Committee has 13 members, six of whom are Bank of England staff, including the governor and four deputy governors. The FPC “identifies, monitors and takes action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the U.K. financial system,” the central bank described.
The committee wrote:
Cryptoasset and associated markets and services continue to grow and to develop rapidly. Such assets are becoming increasingly integrated into the financial system. The FPC judges that direct risks to the stability of the UK financial system from cryptoassets are currently limited.
“However, regulatory and law enforcement frameworks, both domestically and at a global level, need to keep pace with developments in these fast-growing markets in order to manage risks and to maintain broader trust and integrity in the financial system,” the committee added.
The committee further noted that it “will continue to pay close attention to developments, including the relationship between cryptoassets and the U.K. financial system, and thereby seek to ensure resilience to systemic risks that may arise from further developments in cryptoasset markets,” concluding:
The FPC considers that financial institutions should take a cautious and prudent approach to any adoption of these assets.

Early this month, the International Monetary Fund (IMF) warned that the rising popularity of cryptocurrencies posed new challenges to financial stability, stating that it could “reduce the ability of central banks to effectively implement monetary policy” and “create financial stability risks.”
In July, Bank of England Deputy Governor Jon Cunliffe said that cryptocurrencies were not big enough to pose financial stability risk. “They’re not of the size that they would cause financial stability risk, and they’re not connected deeply into the standing financial system,” said the deputy governor.
What do you think about the Bank of England’s comments about crypto assets? Let us know in the comments section below.

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Bank of England unveils all-star payments and tech lineup for CBDC Forums

Bank of England unveils all-star payments and tech lineup for CBDC Forums

The United Kingdom’s central bank is ramping up its research into a central bank digital currency (CBDC) with the selection of a long list of banking and fintech experts to assist it.On Sept. 29 the Bank of England announced the membership of its CBDC Engagement and Technology Forums and they include some big names in technology and finance including Google, Mastercard, Consensys — and even Spotify.This week’s announcement is a signal that the central bank is taking its CBDC plans seriously. It stated that the Technology Forum draws resources from leading experts in the field of digital payments and cryptocurrencies.“The Forum will help the bank to understand the technological challenges of designing, implementing and operating a CBDC.”The Engagement Forum includes “senior stakeholders from industry, civil society, and academia,” that will assist the bank and Treasury to “understand the practical challenges of designing, implementing and operating a CBDC.”Technology experts include PayPal’s blockchain and cryptocurrency Chief Technology Officer, Edwin Aoki. Principal Software Engineer at Google, Will Drewry, joins him as does CBDC and Payments Manager Matthieu Saint Olive from Ethereum software solutions firm ConsenSys.The Technology Forum also includes executives and payments experts from Amazon Web Services, MasterCard, Visa, Stripe, IMB, R3, and music streaming platform Spotify.The Engagement Forum is comprised of banking executives and business experts including co-CEO of Global Banking and Markets at HSBC, Georges Elhedery, Morgan Stanley’s COO Arun Kohli, and Stephen Gilderdale, Chief Product Officer at interbank communication standard SWIFT.Related: UK chancellor names CBDC on list of financial reforms for TreasuryThe Bank of England began tentatively researching CBDCs in November 2020 as reported by Cointelegraph. In April, the central bank posted a list of vacancies related to CBDC research and development. It remains skeptical of cryptocurrencies however, with Bank of England Governor Andrew Bailey warning about the risks of trading cryptocurrencies in May, telling investors “buy them only if you’re prepared to lose all your money.” 

Poll shows Brits concerned over prospect of digital pound

Poll shows Brits concerned over prospect of digital pound

The results of a recent survey undertaken by Redfield & Wilton Strategies on behalf of Politico, suggests that a plurality of the British adult population hold visceral concerns surrounding a Bank of England (BOE) issued central bank-backed digital currency (CBDC).The 2,500 British adults surveyed in the study in early August expressed doubt and concern on the inherent societal benefits of the issuance of a CBDC by the Bank of England.According to the data, 30% of participants believe that a “Britcoin ” CBDC is “more likely to be harmful than beneficial to the UK,” with 24% believing that it could be beneficial, while the remaining participants at 46% were undecided. Deeper analysis of the specific concerns regarding a digital currency revealed that “73% of participants would be “concerned about the threat of hacks and cyberattacks, 70% about users’ privacy, 62% about the government being able to seize their money, and 45% about the environmental impact.”If this initiative crossed the hurdles to public adoption and was implemented country-wide, it would be the first time a digital currency has been issued by a central bank in the United Kingdom.The UK has been exploring the concept of a CBDC for the last few years. In April, Her Majesty’s Treasury and the Bank of England collaborated to launch a preliminary task force designed to comprehend the ‘design, implementation and operation’ challenges associated with a CBDC.Head of fintech at the BOE, Tom Mutton, is pioneering this charge to a CBDC future and recently shared his views on the benefits of implementation from “competition and diversity in payments, through to opportunities to promote financial inclusion and safeguard privacy.”Back in June, Chancellor of the Exchequer Rishi Sunak promised a “sweeping set of financial services reforms” over the next few years, with a CBDC in top list of priorities.Related: Countries representing over 90% of global GDP are exploring CBDCsIn response to the Bank of England’s 2020 discussion paper on the prospect of a CBDC, respondents – who included tech and fintech firms, private individuals, payment firms and more – identified four key themes.These were that the ‘use case’ for CBDC needs to be further developed and better articulated; the need for CBDC to support financial inclusion and protect privacy; the BOE’s design principles are comprehensive, but challenging to deliver; and functional capabilities were considered to be crucial, including offline payments.From the discussion paper, Mutton concluded that there was “near universal agreement that the pros and cons needed to be studied in depth, broad engagement was needed as the evidence was assembled, and open consultation essential before reaching any conclusions.”

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