Bank of International Settlements to Release New Crypto Research

| Publish date: 06/17/2018
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The Bank of International Settlements (BIS) has finally decided to publish a new crypto research. It is even dedicating at least two chapters of its upcoming annual economic report to discuss all digital assets.

A New Crypto Research

Deemed as the central bank’s central bank, BIS is poised to publish the aforementioned chapters this coming weekend. The full report, however, will be unveiled on June 24. The forthcoming report will feature the bank’s most recent quarterly review, which basically revolves around the idea that a number of cryptocurrencies will “ultimately get-rich-quick schemes.”

BIS defines a currency’s credibility as something that has public trust in the issuing entity or institution. The bank added that for it to become successful, it should have a proven record of earning the said trust. But as far as cryptocurrencies are concerned, the short experience only shows that technology – no matter how sophisticated – is nothing but a “poor substitute” for what is called a hard-earned trust in many institutions.

Not Feasible Options

The international financial institution also touched on the claim that digital assets are not entirely feasible options, particularly for a cashless society. Interestingly, this claim is similar to an opinion piece written in March by none other than Markets Committee chair Jackqueline Loh.

BIS further stated that digital currencies, particularly the ones issued by central banks, could only carry a plethora of unwelcomed side effects. And an epitome of this, according to the bank, is making periods of financial instability only worse. This is done by supporting banks’ clients funnel their money from their respective accounts much quicker.

It is worth noting that BIS has since been warning individuals about the future of cryptocurrencies. In the past, it argued that those who would either develop or launch an entirely new digital currency must “carefully weigh” the possible implications of doing such. This is most especially true if it directly relates to monetary policy and overall stability.

While BIS agrees that a digital currency of that nature could prove useful for payments, it does not veer away from arguing that there is more work needed in order to assess the full potential. It even took a middle-of-the-road perspective towards distributed ledge applications, suggesting that a promising technology does not mean it will be widely used by banking institutions. This is not something new really, considering that the institutions’ very own seniors are known to be sharp criticizers of cryptocurrencies in the past.

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