The head of the Bank of England (BE) suggests that potential investors refrain from acquiring cryptocurrency assets as having no intrinsic value.
Andrew Bailey spoke with a caveat regarding cryptocurrencies, calling buyers of cryptoassets comparable to collectors and custodians of rarities.
“People collect all kinds of things. Bitcoin was generally launched to circumvent the restrictions of central banks. Digital products are not a practical means of payment, although the technologies themselves, such as blockchain, are undoubtedly interesting and important.”
The Bank of England states that interest in crypto assets has skyrocketed during the pandemic, with the market size increasing from around $780bn (£624bn) at the start of 2021 to around $1.23tn (£984bn) in 2022.
However, the current fall of the cryptocurrency market and the upcoming crypto winter have led many investors in digital assets to collapse. The loss of billions has raised fears that the collapse of the cryptocurrency market could be the starting point for a notable drop in the stock market.
In April, the financial safety arm of the Bank of England increased its budget for the coming fiscal year, taking into account the possible impact of the risks associated with digital assets.
Source: Bits
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