Sweden’s central bank Governor Stefan Ingves does not see Bitcoin withstanding the test of time. This is according to utterances he made on Thursday at a banking conference, warning that Bitcoin’s “private” nature would be its greatest downfall.
“Private money usually collapses sooner or later- And sure, you can get rich by trading in Bitcoin, but it’s comparable to trading in stamps,” he said.
Sweden has retained a low stance on mainstream cryptocurrencies, opting to build its central bank digital currency, the E-krona which is now in its first pilot phase. The bank is reportedly investigating the need for an Ekrona in the Swedish economy and how an e-krona would affect Swedish legislation as it prepares for a possible procurement of an issuable CBDC.
Most Central Bank bosses still stiff-necked on adopting crypto
The Sveriges Riksbank boss joins a long list of the world’s top bankers who have openly disapproved of cryptocurrencies taking over traditional fiat-backed monetary systems.
On Thursday, Mexico’s Central Bank chief Alejandro Diaz de Leon compared Bitcoin to a means of barter trade as opposed to evolved fiat money according to a Reuters’ reporting. Warning that Bitcoin was not a good safeguard of value, he was worried about the wild price fluctuations exhibited by cryptocurrencies noting that nobody would like their purchasing powers exposed to such volatility.
“Whoever receives bitcoin in exchange for a good or service, we believe that is more akin to bartering because that person is exchanging a good for a good, but not really money for a good,” he said.
Last week, the South African Reserve bank governor called on heightened regulations on cryptocurrencies which he referred to as assets rather than currencies. He argued that although cryptocurrencies were not generally accepted, they are a medium of exchange and a store of value that is only accepted by those using them.
Other top bankers such as England’s Andrew bailey and Irelands Mahlouf have also in the past warned against people buying cryptocurrencies unless they are prepared to lose all their money.
Local banks increasingly embracing crypto
Despite most cryptocurrency warnings coming from central banks across the globe, who mainly find central bank digital currencies (CBDCs) more appealing, a large number of local banks are reportedly dipping their feet into cryptocurrencies through various avenues in response to increased customer demand. Banks such as JPMorgan, which have previously snubbed cryptocurrencies, have quietly unveiled crypto investment packages for their private bank clients. Others such as Standard chartered are reportedly leading in the list of Banks with the biggest investments in crypto ventures.
Some crypto proponents view CBDCs as a waste of time and resources, calling on Central banks to adopt crypto for their survival. According to Tressis chief economist, Daniel Lacalle, “A central bank cryptocurrency is an oxymoron. The reason why citizens demand cryptocurrencies is to escape the money printing of central banks. Central banks should not feel threatened by Bitcoin if they defend the purchasing power of their currency.”