Bank of England (BOA) Governor Andrew Bailey is known for his reluctant stance on decentralized money and has recently improved his anti-crypto rhetoric. At a meeting with lawmakers in London, Bailey stated that cryptocurrencies were “dangerous”.
Andrew Bailey remains skeptical about cryptos
“Crypto assets”, as the official labels of the central bank Bitcoin and the rest represent, pose a danger to the public, Bailey told the finance committee of the British parliament. The governor’s statement on Monday reiterated his longstanding concerns about decentralized digital currencies, Reuters said in a report. Speaking to the committee members, the head of the Bank of England said:
I am honestly skeptical of crypto assets because they are dangerous and there is a lot of buzz out there.
Andrew Bailey’s recent criticism comes after previous statements revealing his negative stance on cryptocurrencies. The governor has warned ordinary Britons in the past not to invest in crypto unless they are willing to lose all of their money.
The BOE boss is of the opinion that digital financial assets such as Bitcoin do not fulfill the key functions of a standard means of payment. In early May, the banker stated, “I just want to emphasize what I have said a few times over the past few years. I fear they have no intrinsic value,” but he also admitted that people can attach “external” value to them And in January, Bailey expressed doubts that a cryptocurrency would last.
The governor’s report reveals growth and inflation concerns
Andrew Bailey’s comments coincide with a tumultuous time in the crypto room. Negative statements from other public figures, organizations and governments have seriously affected the cryptocurrency markets that have lost billions in the past few days and weeks. However, until recently, the crypto-economy performed quite well compared to other sectors that have suffered from the Covid-19 crisis.
According to Bailey’s annual report to the Treasury Committee, the UK’s gross domestic product (GDP) fell 1.5% in the first quarter of this year to 8.7% below pre-pandemic levels in the fourth quarter of 2019, despite the declining impact of various Restrictions on economic activity. In the document released by the Bank of England on Monday, the governor notes:
Over the past twelve months, we have consistently argued that economic activity was going to rebound fairly strongly, but the timing of that effect has been delayed by the continued wave of Covid.
According to the report, Andrew Bailey, who took office as BOE governor in March 2020, is also concerned that UK inflation will not hit the target rate. Last year the indicator was at least one percentage point below the 2% target. Bailey admits he had to explain the reasons for this to the Chancellor of the Exchequer on multiple occasions, including the Covid-related drop in commodity prices, VAT cuts for certain services, and lower demand in general.
The Treasury Select Committee is appointed by the House of Commons to oversee government spending and the administration and policies of the Treasury, the Bank of England, and other public institutions. Bailey was previously Chief Cashier, Deputy Governor, and Chief Executive of BOA’s Financial Conduct Authority.
What do you think of Andrew Bailey’s latest cryptocurrency comments? Let us know in the comments below.
Photo credit: Shutterstock, Pixabay, Wiki Commons
Disclaimer of liability: This article is for informational purposes only. It is not a direct offer or an invitation to submit an offer to buy or sell, or a recommendation or approval of products, services or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author are directly or indirectly responsible for any damage or loss caused or allegedly caused by or in connection with the use or reliance on any content, goods or services mentioned in this article.