July 01, 2019 | AtoZ Markets - Agustin Carstens, Head of the Bank for International Settlements (BIS), has reflected his views about cryptocurrencies in an interview with the Financial Times recently.
Carstens, who was known of his anti-crypto expectations, said in the interview that central banks are likely to issue their own digital currencies, as the need dictates today.
Carstens said that BIS – which acts like a central bank for central banks – supports global central banks’ efforts in researching and developing digital currencies based on national fiat currencies.
There are some central banks which are engaged in the aforementioned work, and “we are working on it, supporting them,” As per Carstens’ description.
Carstens reads that even the issuance date might surprise the crypto community, expecting that “It might be that it is sooner than we think that there is a market and we need to be able to provide central bank digital currencies.”
Facebook Libra will not dominate the crypto space alone!
Carstens’s comments came linked to the Facebook coin that has been in the headlines much nowadays, as the financial sector in general showed concerns with regard to potential threats Facebook Libra is likely to pose against state currencies.
One of the biggest concerns about Libra came on the tongue of France’s finance minister, who said that Libra must not be allowed to become a “sovereign currency”.
In a similar context, Congresswoman Maxine Waters had asked Facebook to halt development of the Libra Network until hearings can be held.
In the light of the above-mentioned negative views about Facebook Libra, Carstens commented saying:
“The issue is how will the currency be used? Will there be discovery of information, or data that can be used in credit provision and how will data privacy be protected?” he said, adding that a “simple way” to regulate such cryptocurrency networks is to start addressing “immediate and very obvious” money laundering concerns.
The Bank for International Settlements (BIS) had included the Facebook coin in its latest annual report, expressing fears that initiatives that Libra may pose a long-term threat to central banks control of money:
“Regulators need to ensure a level playing field between big techs and banks, taking into account big techs’ wide customer base, access to information and broad-ranging business models.” Mentioned the report at the time.