Bitcoin barely finds mention among top risks to financial system
Washington: The US government’s chief watchdog for financial system threats put out its annual list of potential nightmares, and the burgeoning market for digital currencies such as bitcoin didn’t rate much more than a few lines in the 152-page report.
While big names in global finance such as JPMorgan Chase & Co. chief executive officer (CEO) Jamie Dimon have publicly warned that cryptocurrencies are doomed to collapse, the Financial Stability Oversight Board isn’t concerned yet. The panel said digital currency’s “current impact on financial stability is likely very limited.”
“Virtual currencies are only used by a very small number of consumers,” the group said in its report. FSOC gives a bit more credit to the potentially “much broader applications” of the so-called distributed ledger technology underpinning the innovations. And it notes that this digital wave also presents a regulatory challenge, because the storage of data is decentralized, rather than being in one spot that governments can watch.
We’ll keep an eye on all of this, is basically what they’re saying.
One thing that may trouble those who have watched the bitcoin market soar in recent weeks and who fear its potential collapse: The council’s report issued on Thursday based some of its views on a survey of consumer behaviour. From 2015. Bloomberg