Agustin Carstens, Bank for International Settlements (BIS) general manager and a noted bitcoin critic, has said that the launch of central bank-backed crypto assets could undermine financial stability.
During his speech at the Central Bank of Ireland, the BIS official said:
“There are huge operational consequences for central banks in implementing monetary policy and implications for the stability of the financial system. Central banks do not put a brake on innovations just for the sake of it. But neither should they speed ahead disregarding all traffic conditions.”
Considering the role of central banks in maintaining stability in the global financial market, the integration of decentralized crypto assets or blockchain-based solutions could present a risk.
However, it remains unclear whether permissioned blockchain networks or centralized ledgers present a similar risk given that central banks could arguably have tighter control over the circulation of money.
Bitcoin is Decentralized But Permissioned Blockchain-Based Crypto Assets Aren’t
Bitcoin is a truly decentralized and a peer-to-peer blockchain network that is sustained by an open-source community of developers, miners, node operators, and users.