BOE Adviser “not so worried about cryptocurrencies”
In an interview with Bloomberg earlier today, Huw van Steenis, senior adviser to the Bank of England’s (BOE) governor Mark Carney said that cryptocurrencies fail fundamental tests.
Having worked previously at Schroders and Morgan Stanley, Van Steenis joined the BOE in 2018, and is currently conducting a review of the future of finance, according to Bloomberg.
When asked about cryptocurrency’s potential to disrupt economic systems:
“I’m not so worried about cryptocurrencies. They fail the basic tests of financial services. They’re not a great unit of exchange, they don’t hold value, and they’re slower.”
Of course, many crypto advocates would point to the year over year declining value of inflationary fiat currencies like the U.S. dollar to at least partially contradict this point, while others might agree with it, but point to the nascent stage cryptocurrency finds itself in as a reason to believe developers will be able to solve technical issues, like speed.
Van Steenis also noted that large, traditional banks are slow to adopt new technologies, unlike their start-up counterparts. He continued:
“What I love when meeting with fintechs is their obsession with customers. The challenge is will they get customers before the traditional banks can innovate.”
Last March, the Treasury of the United Kingdom launched the Cryptoassets Taskforce, which is comprised of the Financial Conduct Authority and the BOE, in an attempt to develop a legal framework for cryptocurrencies. In a statement, U.K. Finance Minister Philip Hammond said that the new taskforce will work to create industry standards to facilitate collaborations between fintech companies and bank, and support innovation in the fintech space.
Last October, the taskforce released a report that proposed to classify cryptoassets into one of three groups: exchange tokens, security tokens, and utility tokens, and noted the risks related to crypto, like lack of market manipulation and consumer protection.