Bank of England flags rising systemic risks from the metaverse

Widespread uptake of crypto assets in metaverse could pose a systemic risk to financial stability and require ‘robust protection of consumers’ rights’. To these выводам Lok and Kashino said.

They believe that, through decentralized digital worlds and platforms, large volumes of “real economic transactions” in cryptocurrency will pass. This could potentially threaten financial stability, the BoE says.

“Therefore an important step for regulators is to mitigate risks associated with the use of crypto assets in the metaverse before they reach systemic status,” Lok and Kashino said.

They presented a scenario in which consumers spend a lot of money and time in virtual worlds. According to the Bank’s staff, households could store part of their savings in digital assets. Companies, in turn, would begin to accept payments in cryptocurrencies, and financial institutions would offer related industry services.

“We contend that, if an open and decentralised metaverse grows, the crypto-asset–related risks could scale up and have systemic consequences for financial stability,” the BoE officials noted.

Earlier, analysts at Citibank forecast growth of the metaverse economy to $13 trillion by 2030.

According to Trend Micro experts, the development of virtual worlds will lead to the spread of traditional cyber threats in them and the emergence of new ones.

Earlier, Ethereum co-founder Vitalik Buterin warned that existing corporate attempts to create a metaverse are doomed to fail.

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