Reserve Bank of Australia (RBA) Governor Glenn Stevens says that the advent of virtual currencies just might pose challenges for regulators around the world, given they operate “outside the perimeter” of central bank control.
“Devoting a lot of resources to ever greater refinements to the details of existing regulatory structures will not help us,” he said with reference to assessing whether or not virtual currency could threaten the stability of the current financial system.
Stevens made his comments at the Symposium on Asian Banking and Finance in San Francisco, according to The Daily Telegraph.
“The possible rise of virtual currencies, the potential for the distinction between regulated financial institutions and telecommunications and technology companies to become blurred may pose challenges,” he added. “They doubtless will not be the only ones.”
Most regulators around the world are taking a hands-off approach when it comes to this new, emerging sector. Despite that, many say they are watching developments closely in order to determine when the best time to step in would be.
And when that time comes, the crypto-currency community is no short of worried as to what implications these new regulations might mean for them.
As an example, earlier this year the United States Internal Revenue Service declared that bitcoin holdings should be treated like property, for federal tax purposes.
Shortly after the IRS guidance, the community erupted in disapproval, criticizing the tax authority for not consulting experts before issuing their rules.
Virtual currency can be risky, hence regulator interest in controlling it. For now though, Stevens doesn’t see a problem with that.
“Those who seek high returns, and are prepared to accept the risk, should be allowed to do so. There is value in that occurring.”
[textmarker color=”C24000″]Source[/textmarker] The Daily Telegraph