Australia’s most powerful banker has issued a warning about cryptocurrencies as the government cracks down on decentralized finance.
Whereas Bitcoin Falling below $70,000, it is still almost three times the value of $25,000 a year ago.
The volatility has prompted the Governor of the Reserve Bank of Australia, Philip Lowe, to urge investors to be careful about investing in the cryptocurrency.
He said at the Australian Payments Network summit on Thursday, ‘The buyer of these properties should take care.
Australia’s most powerful banker has issued a warning about cryptocurrencies as the government cracks down on decentralized finance. While bitcoin has fallen below $70,000, it is still worth almost three times its $25,000 value a year ago.
“There is still a lot of uncertainty about the long-term usefulness of these assets,” he cautioned.
‘Before investing, it is best to fully understand the underlying value proposition.’
Last month, the head of the Reserve Bank of Australia’s payments policy section, Tony Richards, warned that cryptocurrency prices could crash.
He added, “There are plausible scenarios where a number of factors can come together to significantly challenge the current enthusiasm for cryptocurrencies, to begin reversing the current speculative demand, and much of the price hike in recent years.” Maybe,” he said.
‘The fads in homes and the fear of missing out may be less affected and begin to heed the warnings of securities regulators and consumer protection agencies in many countries with no issuer, no backing and highly uncertain prices. .’
Dr Lowe said that a central bank digital currency would be a better version of decentralized finance than a volatile cryptocurrency market.
“It is likely that the assets used to settle most transactions in the economy will remain in some form of secure fiat currency with a stable value, rather than a cryptocurrency with a volatile value,” he said.
A day after Treasurer Josh Frydenberg flagged off the biggest changes to Australia’s payment system since the mid-1990s, the Reserve Bank is again talking about the stability of cryptocurrencies, to reflect the emergence of cryptocurrencies and Buy now, pay later app.
Volatility has prompted Reserve Bank of Australia Governor Philip Lowe to caution investors about investing in cryptocurrencies
A general distrust of banks has seen over 800,000 Australian investors put their money into crypto, including Bitcoin, from 2018.
The Treasury will begin putting together a licensing system for digital currency exchanges in early 2022.
Canberra bureaucrats will also explore the idea of a central bank digital currency with recommendations by the end of next year.
Data from the Australian Taxation Office shows that 819,000 Australians have purchased a cryptocurrency since 2018, with the number of transactions in 2021 increasing by 63 percent compared to 2020.
The Financial Regulatory Council – which includes the Treasury, the Reserve Bank of Australia, the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission – will provide recommendations by mid-2022.
The value of bitcoin has increased in 2021, from $25,000 a year ago to $70,000 now.
But a month ago, it cost more than $91,000.
In May, bitcoin lost a third of its value within a week, falling from $74,000 to $50,000 after billionaire Tesla founder Elon Musk began accepting bitcoin as payment for his electric cars. changed his mind.
The 50-year-old tycoon argued cryptocurrency mining, creating bitcoin by solving complex mathematical puzzles, used a lot of fossil fuels and his announcement led to a 16 percent drop in just one day.
A day after Treasurer Josh Frydenberg flagged off the biggest changes to Australia’s payment system since the mid-1990s, the Reserve Bank is again talking about the stability of cryptocurrencies, reflecting the emergence of cryptocurrencies And buy now, pay later.
Until cryptocurrency is regulated, the only regulated products related to cryptocurrency will be exchange-traded funds on the Australian Securities Exchange.
BetaShares this month launched CRYP on the ASX which invests in companies that are involved in broader crypto investments.
Commonwealth Bank announced in November that it would allow cryptocurrencies to be traded on its banking app, making it the first bank in Australia.
Australia’s largest bank’s 6.5 million customers will be able to buy and sell digital currencies such as bitcoin, the same way they can do share transactions on the ComSec app.
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