Bitcoin has no intrinsic value, but stablecoins may carve out a niche in the financial system. This was stated by Bank of England Governor Andrew Bailey.
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The head of the regulator noted the outward danger from decentralized assets such as bitcoin, as well as interest in stablecoins and central bank digital currencies (CBDCs).
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“Stablecoins are backed. Bitcoin has none; it is not money. The term ‘cryptocurrency’ is not precise.”, the official explained.
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Bailey noted that the Bank of England is monitoring the actions of large technology companies exploring the possibility of issuing global stablecoins. He added that the Financial Policy Committee laid out its expectations regarding the principles of their regulation.
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According to the central bank chief, CBDCs could play “an important role in maintaining and expanding access to fiat for retail users.”
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In June, the Bank of England said it was necessary to apply banking-payment rules to stablecoins.
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At the latest G7 leaders’ meeting, they confirmed that no global stablecoin project should commence operation until full compliance with legal, regulatory and supervisory requirements is achieved.
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Earlier, the head of the Fed Jerome Powell noted the priority of regulating stablecoins, which could at any moment become systemically important.
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In a report on the international role of the euro, ECB warned of problems facing central banks in the absence of their own CBDCs.
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In May 2020, the regulator considered three scenarios for using Facebook’s regulated digital currency Diem. Analysts estimated that the volume of funds directed to the global version of the stablecoin could range from €152.7 billion to €2.93 trillion.
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In May 2021, the Diem project stated plans to launch in the United States with a focus on the American market only.
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In February, Amazon announced a developer kit for a digital currency project.
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