One thing that hasn't been talked about a lot is that banks are conservative because non-compliance with the law results in serious financial penalties from national regulators.
A lot of them scared because Bitcoin is the strange new thing that is largely unregulated and no regulator really knows what to do with it. Banks don't want to get in a position in the future when they have significant exposure to Bitcoin, no upside and severe downside from fines/penalties issued from regulators.
Sometimes, the "wait and see" game is the right thing to do, especially when you have a lot to lose.
I imagine it would be the smaller banks that would be willing to adopt Bitcoin and take on the risk.
Topic: Bank of England on Bitcoin. Imagine you are in their shoes. (Read 863 times)
It's very probable that some kind of official governmental / bank-issued digital currency will become the norm, but they will want something they can control. I hope people refuse to use it and go for a decentralised currency like btc instead,
Interesting statement recently by The Bank of England on bitcoin.
Amongst other things (including a good explanation of monetary systems and bitcoin) it states that :- "Potential risks to monetary stability would only be likely to emerge once digital currencies had achieved substantial usage across the economy."
Earlier it states that :- "The majority of financial assets — such as loans, bonds, stocks and derivatives — now exist only in electronic form, meaning that the financial system itself is already simply a set of digital records. These records are currently held in a tiered structure (that is, with records of individuals’ accounts stored centrally at their bank, and banks’ reserves accounts held centrally at the central bank), but it may be possible in the future — in theory, at least — for the existing infrastructure of the financial system to be gradually replaced by variety of distributed systems (although this article makes no prediction in this regard)."
Put yourself in their shoes -and lets say the B of E sees bitcoin as a threat. They do however understand the potential of blockchain technology.
How would you, in their shoes, get around the threat posed by bitcoin ? Could they, for eg., utilise the blockchain to issue their own "coin" to confer (most of) the benefits of btc - and thereby take the wind out of its sails ? Or maybe as a reserve currency ?
Just thinking aloud here. Interested in your thoughts. What would be their next move ?
ps. for the BofE you can read the Fed etc etc.
Amongst other things (including a good explanation of monetary systems and bitcoin) it states that :- "Potential risks to monetary stability would only be likely to emerge once digital currencies had achieved substantial usage across the economy."
Earlier it states that :- "The majority of financial assets — such as loans, bonds, stocks and derivatives — now exist only in electronic form, meaning that the financial system itself is already simply a set of digital records. These records are currently held in a tiered structure (that is, with records of individuals’ accounts stored centrally at their bank, and banks’ reserves accounts held centrally at the central bank), but it may be possible in the future — in theory, at least — for the existing infrastructure of the financial system to be gradually replaced by variety of distributed systems (although this article makes no prediction in this regard)."
Put yourself in their shoes -and lets say the B of E sees bitcoin as a threat. They do however understand the potential of blockchain technology.
How would you, in their shoes, get around the threat posed by bitcoin ? Could they, for eg., utilise the blockchain to issue their own "coin" to confer (most of) the benefits of btc - and thereby take the wind out of its sails ? Or maybe as a reserve currency ?
Just thinking aloud here. Interested in your thoughts. What would be their next move ?
ps. for the BofE you can read the Fed etc etc.
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