Andrew Bailey, governor of the Bank of England, spoke this week at the Brookings Institute in the United States and addressed a hot topic: cryptocurrencies, specifically, Bailey talked about the effectiveness, or lack of it, when virtual assets are secured in payment transactions.
Bailey said that while Bitcoin would possibly have an “extrinsic value,” it has no connection to cash and does not adapt to global payments.
Stablecoins, on the other hand, may have merit, according to the governor:
Bailey becomes inventions in virtual currency, however, he rightly expresses the need for solid currencies to meet operating criteria similar to other banknote and transfer bureaucracies.
Bailey stated that some solid portions do not meet this standard:
Global solid currencies should have “strong governance” and a transparent structure.Regulators should be a component of the combination if you want a looming solidcoin transmitter to be worthy to carry out your mission.
With regard to the central bank virtual currency (CBDC), Bailey echoes a sentiment that has been expressed through many others: that a CBDC requires careful attention and before any use.The Bank of England has explored CBDCs, as well as many other jurisdictions..
Jackson Mueller, director of government policy and affairs at Securrency, a Regtech/fintech company that seeks to facilitate “a new monetary infrastructure to take advantage of the benefits of blockchain technology,” shared the following commentary after Bailey’s speech:
“There is a component of Andrew Bailey’s comments that resonate within regulatory agencies, lawmakers’ corridors, and industry offices.In other words, the need for a broader debate about the long term bills and how payment inventions will interact and interoperate networks and borders,” Meuller said.”For too long, we have focused on cryptoactives, solid components, CBDCs, among other payment bureaucracies, strictly on the silos of this terminology.Basically, we lack the forest for the trees.”
Mueller said that what he wanted to be analyzed in much more detail and more importantly was the underlying architecture that supports those inventions and payment futures and how that formula can evolve (and is currently) in a way that can be managed in a responsible manner.price movement through disparate formulas and in a way that fosters innovation, maintaining strong regulatory criteria that protect the underlying monetary eco formula.
“What this means is an acknowledgement that all that price bureaucracy can move on non-unusual security and compliance rails without creating a monolithic network and preserving technological options.”