Andrew Bailey, Governor of the Bank of England (BoE), shared his thoughts on Bitcoin and cryptocurrencies at an event he attended at Cambridge University.
After saying that the rapid growth of cryptocurrencies could pose a threat to the world financial system, the BoE chief said that the volatile nature of cryptocurrencies is worrying, and in this context, they must be stable if they are to be widely used in transactions such as payments.
Criticizing the volatile nature of Bitcoin and other cryptocurrencies over El Salvador’s acceptance of Bitcoin as a legal currency, BoE chairman Bailey stated that consumers are likely to eventually suffer from Bitcoin’s volatile nature.
“It worries me that a country has chosen it as its national currency. What worries me the most is whether the citizens of El Salvador understand the nature and volatility of the currency they have.”
Although BoE chief Andrew Bailey has negative thoughts about Bitcoin and cryptocurrencies, he is not against the technology.
Bailey continued by explaining that they are working on the creation of the Bank of England’s own digital currency payment system, the Digital Pound:
“There is a strong case for digital currencies but in our view they need to be stable, especially if they are going to be used for payments. This does not apply to crypto assets.”
The World Bank, IMF, economists, and international organizations, such as BoE chief Andrew Bailey, have expressed concerns about El Salvador’s adoption of Bitcoin.
*Not investment advice.