Bitcoin Too Small To Threaten Global Economy, Says Bank of England Deputy Governor

Not long after the value of bitcoin passed the historic $10,000 mark, Sir Jon Cunliffe, the deputy governor of the Bank of England (BoE), told BBC Radio 5 Live that the cryptocurrency’s market capacity is “not at a size where it’s a macroeconomic risk to the global economy.”

He added that, considering the token’s volatility, potential investors would be well-advised to “do their homework” before purchasing any bitcoin, which, he said, is “much more like a commodity” than a currency, considering its lack of central bank backing.

In September, European Central Bank Vice President Vítor Constâncio reported that he and his colleagues “don’t see it as a threat to central banking or monetary policy, that’s for sure.” His perspective also aligned with Cunliffe’s on the count that bitcoin is “certainly not a currency.”

The BoE has conducted a FinTech accelerator that, among other things, explored certain implications of distributed ledger technology (DLT), of which Andrew Hauser, the bank’s executive director for banking payments and financial resilience, said, “the attraction of DLT to central banks” has to do with the fact that the “failure of a node has no impact on the overall resilience of the system.”