It is no surprise to anyone that banks and financial institutions have been struggling to see the true value of cryptocurrencies. And perhaps some of them even see the value, but fear it, as it's meant to disrupt the current financial systems, give more power to regular people, while taking control away from the banks.
Another central banker - Agustín Carstens from the Bank of International Settlements showed his hand again.
Carstens, in a recent interview, announced his view:
"If you look at them closely, cryptocurrencies are, in a nutshell, a bubble, a Ponzi scheme and an environmental disaster - the latter because of the high energy consumption needed to run the infrastructure for these cryptocurrencies."
There is no surprise there, given what the Bank of International Settlements' role is.
First of all, BIS is not a central bank. It's much more - it's more of a bank for Central Banks. It is owned by central banks and it's main public purpose is to "maintain financial stability". But alas, maintaining financial stability means there will never be financial innovations, where ideas do not thrive and the monetary world is ruled by same old farts, contradicting Carsten's next statement completely:
"Young people should use their many talents and skills for innovation, not reinventing money. It's a fallacy to think money can be created from nothing. So my message to young people would be: Stop trying to create money!"
img credz: pixabay.com
Of course, the insane rallies of low-utility coins and their insane mining fees (in electricity) are a by-product of the public racing to get rich quick - it always accompanies innovation. There is no way around it - it was a short-term bubble, it had to pop, leaving burned bodies behind, but as the dust settles, the coins with real value as utility tokens, will rise from the ashes like a phoenix.
What men like Carsten do not understand, that many with skills do not have equal access to money. Cryptocurrencies have the potential to disrupt that inequality, if even by a bit, giving another method of bartering to the regular people. Speculation is just a side product. And I am fairly sure, banks are the biggest speculators - so perhaps Carsten should look at cleaning his own yard first, before curbing innovation and pointing his fingers at "young people".
Can we soon start seeing cryptos picking up and Bitcoin "shorts" getting out of fashion?
Materials:
coindesk.com
bis.org/speeches
wikipedia.org
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