The world has been relatively divided when it comes to cryptocurrency with various countries, like the United Arab Emirates going all out to advocate its growth, while at the same time countries, like the United Kingdom are still grappling to come to terms with it. In a recent interview to CNBC, the deputy governor of the central bank of the UK, the Bank of England (BOE), Dave Ramsden, expressed the general attitude of the country’s administration and financial institutions towards cryptocurrencies and digital assets.
Dave Ramsden’s Remarks
According to him, the volatility inherent in digital assets makes it difficult for them to be a stable store of value. Ramsden also stated that the Financial Policy Committee (FPC) of UK has been firm on this very stance and has even questioned the utility of cryptocurrencies as a medium of exchange given their unreasonably high transaction costs.
The FPC didn’t just stop there but also went on to remark that cryptocurrencies don’t even fit the general definition of a currency, a sentiment echoed by the senior adviser of the Governor of BOE, Huw van Steenis. He revealed that for any kind of financial instrument to qualify as a currency they need to clear a few fundamental tests, most of which were failed by cryptocurrencies.
Seconding these opinions, Ramsden added that given the still nascent stage of the cryptocurrency market that makes up for a small percentage of the entire financial market, it is not in a position to threaten the financial stability of the country.
Global Climate for Cryptocurrencies
In stark contrast to the political stance on cryptocurrencies is the enthusiasm of the common people, a glimpse of which the BOE also got to witness last December. Their Twitter survey on the most preferred form of currency to receive as a Christmas gift brought a surprise for the bank. 75% of the votes were in favor of digital currencies.Moreover, the general climate of the world also seems to be changing in favor of cryptocurrencies with many well-known businesses, like Corporate Traveller and even some governments, like that of Japan accepting them into their operations.