Cryptos Are Not a Threat to Financial Stability

Central Bank of Germany representative Burkhard Balz said that cryptocurrencies do not pose a threat to financial stability during a talk at the European Parliament reported a post published on the institution’s website on July 9.

Burkhard Balz, Member of the Executive Board of the Deutsche Bundesbank, stated that “crypto-tokens currently do not pose a risk to monetary or financial stability.” Furthermore, he also noted that “gaps may occur where they fall outside the scope of regulators’ authority or where there is an absence of international standards.”

This idea is in line with the claims of Spanish law enforcement representatives, who pointed out that Bitcoin ATMs show a gap in European Union’s Anti-Money Laundering (AML) regulations, as Cointelegraph reported earlier today. Balz also warned in his talk that any increase in the popularity of crypto assets warrants close scrutiny. Still, he also expressed high hopes for digital transformation brought on by artificial intelligence, distributed ledger technology, and cloud services, saying:

“We are not talking about “evolution,” about banking adapting to the wants and needs of a digital generation – we are talking about a true “disruption” that may change the financial sector for good.”

Last week European Central Bank executive board member Benoit Coeure said that financial regulators must act fast to prepare for Facebook’s Libra stablecoin.

As Cointelegraph reported last month, Australia’s central bank said Bitcoin and cryptocurrencies would remain outside mainstream payments.