7 Central Banks from Around the World Share Their Thoughts on Bitcoin
by Andrew McGuinness Jul 16, 2019
Nearly a decade since Satoshi Nakamoto’s famous whitepaper that started the cryptocurrency financial and cultural revolution, central banks around the world are finally seeing the true potential (and threat) Bitcoin and other digital decentralized currencies have on their existence. Whether you support banks or decentralization, trading 101 always teaches us to know everything about our investment, and this means listening to the insight of central banks, and what they think about Bitcoin.
1) China—Embrace, But Stay in Control
China has been much stricter on cryptocurrencies than other countries, as was expected. However, they are starting to recognize the value of blockchain technology, but they want to keep this power in the hands of the government: they started developing their own digital fiat money back in 2014. While the People’s Bank of China has yet to announce when the official national digital fiat will come rolling out, authorities are insistent that digital currencies will improve efficiency nationwide.
2) UK—“Revolution”
Mark Carney, Governor of the Bank of England, claimed that Bitcoin is a potential financial “revolution”. He is open to the idea of blockchain technology, claiming that it has “great promise” in strengthening bank security against hackers and other forms of cyberattacks. There is much speculation surrounding whether or not the Bank of England will develop their own digital sterling.
3) India—Banned
India has vehemently stood against cryptocurrencies, with their central bank claiming that Bitcoin’s main functions are to finance terrorists and launder money. Using cryptocurrencies in India is a violation.
4) Germany—“Speculative Plaything”
Germany is a country where many still use physical cash rather than cards or checks, which is why their stance against cryptocurrency has been more cautious than most. Carl-Ludwig Thiele, board member of the Bundesbank, has called Bitcoin a “speculative plaything”, potentially disrupting working financial business models and causing problems around the world.
5) EU—“Tulip-Like”
One of the biggest naysayers of Bitcoin and digital currencies is the European Central Bank, with Vice President Vitor Constancio comparing Bitcoin to the tulip bubble of the 17th century in the Netherlands, when tulips were selling for several times their value due to the speculation that their value would continue to increase. Other board members of the European Central Bank are largely concerned about the unstable value of Bitcoin and the potentials for tax evasion and other crimes.
6) Canada—Not a True Form of Currency
Carolyn Wilkins, the senior deputy governor of the Bank of Canada, recently commented on cryptocurrencies, claiming that they aren’t “true forms of money”, but rather “assets” and should be treated accordingly.
7) Russia—Pyramid Scheme
The central bank in Russia has largely opposed Bitcoin and cryptocurrencies, with its governor, Elvira Nabiulliana, dismissing it as a “pyramid scheme” that the country will refuse to legitimize. Prosecutors and the central bank in Russia are working to block all websites that allow users to invest in Bitcoin and other cryptocurrencies.
8) Turkey—Important for the Future
Murat Cetinkaya, governor of the Turkish Central Bank, is positive when it comes to Bitcoin and other digital currencies. While they pose risks to central banks due to their decentralized nature, they are the first step towards a cashless and more financially efficient global economy.
9) US—Privacy Issues
The central bank in the US has yet to truly begin discussing regulating Bitcoin and other cryptocurrencies, but they are starting to look into it. Powell Jerome, aa board member of the Federal Reserve, claimed that cryptocurrencies bring “privacy issues” that could pose problems to central banks.