The Bank for International settlements has just published a scathing diatribe, but will it make any difference?by Paul Wallace / June 22, 2018 / Leave a comment
Central bankers don’t like cryptocurrencies. They are after all an intrusion on their own turf, offering an alternative money. So it is hardly surprising that the Bank for International Settlements, the central banks’ bank, takes a dim view of the innovation. New research in its annual report offers a particularly cogent attack on the viability of cryptocurrencies—digital forms of money based on encryption techniques.
The BIS goes back to basics, arguing that money is fundamentally about trust. That trust underpins how money fulfils its three central functions, as a store of value, unit of account and medium of exchange. It enables the use of what are essentially tokens in the form of banknotes and coin and facilitates payments from one account to another.