The governor of the British central bank, Andrew Bailey, pleads for regulation of stablecoins. As for crypto-currencies, and in particular Bitcoin, the banker considers that they are unsuitable for payments.
In March, who would then be the future governor of the Bank of England, issued a warning against Bitcoin. For Andrew Bailey, Bitcoin investors must be “ready to lose all their money”.
The now central banker has not changed his mind since. At an online conference organized by the Brookings Institute, he once again exposed his position with regard to crypto-assets.
Bitcoin has nothing to do with money
For the latter, cryptocurrency is simply “unsuitable for the world of payments.” “And as regards precisely Bitcoin, it has quite simply” no link with the currency “considers the governor of the BoE.
But then, do crypto-currencies find favor in his eyes as financial products? It is not certain. As Cointelegraph reports, Andrew Bailey also doubts their suitability as an investment opportunity.
The reason given: “their value fluctuates widely, without notice,” he argues. However, not all crypto-assets are sources of distrust for the banker, especially in the area of payments.
The boss of the BoE thus recognizes some merits to stablecoins, which according to him may offer certain “useful advantages”, in particular by helping to reduce friction in payments. These benefits, however, come with conditions.
Rights and protections for stablecoin holders
“If stablecoins are to be widely used as a means of payment, they must meet standards equivalent to those in place today for other forms of payment and the forms of money transferred through them” advocates Andrew Bailey.
The governor of the central bank also advocates for protections and guarantees for the holders of these assets. However, according to him, this legal framework does not currently exist for some stablecoins.
These assets should thus offer “to coin holders a robust right, with support mechanisms and protections to ensure that they can be redeemed at any time at 1 to 1 in fiat money. “