Bank of England Deputy Governor Jon Cunliffe has brushed off the huge growth in popularity of cryptocurrencies, saying they pose no threat to traditional banking.
The veteran banker suggested no crypto had enough volume to be recognised as a system that could overtake established finance any time soon.
“The speculative boom in crypto is very noticeable but I don’t think it’s crossed the boundary into financial stability risk,” he said in an interview with CNBC’s Joumanna Bercetche.
“There are issues of investor protection here. These are highly speculative assets, but they’re not of the size that they would cause financial stability risk, and they’re not connected deeply into the standing financial system.
“Were we to start to see those links develop, were we to start to see it move out of retail more into wholesale and see the financial sector more exposed, then I think you might start to think about risk in that sense.”
While labelling crypto speculation as a practice mainly limited to retail investors for now, he also reiterated the central bank’s position that people investing in digital assets should be prepared to lose all their money.
