Bank of Canada Acknowledges Bitcoin Could Possibly Disrupt Global Financial Stability
- Bank of Canada says bitcoin could threaten global financial stability in new report
The Bank of Canada has released a new document outlining some of their views on bitcoin (and digital currency).
Perhaps most interesting, the Canadian Central Bank acknowledged that bitcoin could possibly disrupt global financial stability if its adoption continues to grow.
As they do with platform-based digital currencies, central banks are studying and closely monitoring decentralized digital currencies such as Bitcoin. There could be potential risks to overall ﬁnancial stability if Bitcoin became a signiﬁcant means of payment and the Bitcoin system remained unstable.
It’s no surprise that the Bank of Canada has their eyes on bitcoin.
Over the past year, the use of and popularity of this digital currency has grown exponentially, seeing growth in North America, Europe, and as far east as Asia.
Chinese interest in bitcoin even drove the price per coin upwards of $1,000 in late 2013.
But the bank managed to sprinkle in some warnings to those who are looking to get involved with this payment system/currency:
Governments may become concerned about legal security and law enforcement issues associated with Bitcoins. For example, the private nature of bitcoin transactions, bitcoins could easily be used to facilitate criminal transactions and to evade taxes.
Other warnings included the possibility of failed exchanges, the nature of the protocol in that there is not centralized issuer, and being unable to reverse transactions.
These are the types of warnings the community has been seeing for months on end at this juncture. A number of Central Banks have issued similar warnings along with several U.S. States.