September 22, 2020

Central Bank of France: central banks have three options for regulating cryptocurrency

Central Bank of France: central banks have three options for regulating cryptocurrency

French Central Bank Deputy Governor Denis Bo Sure “Central Banks Have Only Three Options solving the problem of the spread of crypto assets. "

The deputy head of the Central Bank discussed the role of crypto assets in the traditional financial system during his speech at the conference of monetary and financial institutions in London.

Bo noted that the global cross-border systempayments at risk of facing threats and losses through technological innovation. This will jeopardize the functioning of the traditional banking ecosystem.

Bo noticed that stable coins are a serious competitor to traditional banking. The banker notes that the Central Bank has three possible options for regulating cryptocurrency circulation:

1. Ignore crypto assets, which will increase the potential risks for the traditional banking system.

2. To prohibit at the state level all crypto assets, which is difficult if we take into account the degree of their distribution.

3. Develop uniform rules for the circulation of digital currency in the European space.

The banker considers the third direction the most promising for the banking system, and the most difficult. Digital currencies represent real competition that banks have not seen before.

Regulators and cryptocurrency market players note that the lack of common rules, standards and procedures in the blockchain space remains the main problem in the development of the industry.