Kevin Helms
An Austrian economics student, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open source systems, network effects and the intersection of economics and cryptography.
Crypto needs improved regulatory and law enforcement frameworks – regulation of Bitcoin news
The Bank of England says “extreme volatility” in the crypto market “underscores the need for improved regulatory and law enforcement frameworks.” The British central bank has warned that cryptocurrencies could fall further.
Bank of England demands improved crypto-regulation
The Bank of England’s fiscal policy committee, the Bank of England (BOE), said on Tuesday that “extreme volatility” in crypto prices in recent months underscores vulnerabilities in the crypto market, Bloomberg reported.
Referring to a $ 2 trillion reduction in the total market value of cryptocurrencies, the Bank of England stressed the need for tougher law enforcement and regulation for the crypto sector, the publication said. The market value of all cryptocurrencies is currently around $ 1 trillion. That was almost $ 3 trillion at the top in November last year.
Last month, Agustin Carstens, general manager of the Bank of International Settlements (BIS), said that all the weaknesses in the crypto market “that were pointed out earlier have pretty much materialized.” They include liquidity mismatches and participants who settle mortgaged positions.
The British central bank warns that the crypto market may decline further, said:
This underlines the need for improved regulatory and law enforcement frameworks to meet developments in these markets.
Although it notes that cryptocurrency market volatility does not currently pose a risk to the stability of the UK financial system, the central bank warned that systemic risk would emerge if cryptocurrency activity and its relationship with the traditional financial system continue to grow.
Last month, the President of the European Central Bank (ECB), Christine Lagarde, said in the same way: “Crypto-assets and decentralized finance (defi) have the potential to pose a real risk to financial stability.”
The Bank of England’s Deputy Governor for Financial Stability, Sir Jon Cunliffe, has said on several occasions that the cryptocurrency market can pose a threat unless it is urgent to regulate. He warned in May of difficult times ahead for cryptocurrency investors as the Federal Reserve and other central banks tighten monetary policy. In December last year, he said that crypto prices could fall to zero.
Andrew Bailey, the governor of the Bank of England, said in June that investors should be prepared to lose all their money when investing in cryptocurrencies. He stressed that cryptocurrencies do not have intrinsic value and bitcoin is not a convenient means of payment.
What do you think of the comments from the Bank of England? Let us know in the comments section below.
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