The Bank of England warned about the risks of cryptocurrencies: “Their price could fall to zero”

The Lieutenant Governor of the Bank of England, Jon Cunliffe, warned by the rapid growth of cryptocurrencies in the United Kingdom and urged regulators to create rules to order the operation and the listing of those assets.

In dialogue with the BBC, Cunliffe, second in charge of the English central bank, warned for one of the characteristics of cryptocurrencies: “Its price can vary considerably and, in theory or in practice, it could drop to zero.”

Although he clarified that just around the 0,1% of households in England have money invested in cryptocurrencies (with an individual average of £ 300), highlighted that these assets have “Grown very fast.”

“The point, I think, you worry about is when you integrate into the financial system, when a large price correction could actually affect other markets and affect established players in the financial market”He declared.

Along these lines, he warned: “Not there yet, but it takes time to design rules and regulations”.

For Cunliffe, “we have to roll up our sleeves and get to work, so that when this becomes a much bigger problem, let’s really have the regulatory framework to contain the risks ”.

The statements of the deputy governor of the Bank of England came after the agency published the financial sustainability report, which examines the health of the UK financial system.

“The UK and world economies have continued to recover from the effects of the pandemic. However, uncertainty about public health risks and the economic outlook persists”, Highlighted the report.

In that sense, the Bank stated: “For example, there are short-term pressures on supply and inflation, and there could be a greater impact of Covid on activity, especially given the uncertainty as to whether the new variants of the virus reduce the efficacy of the vaccine ”.

‘The UK’s major banks are strong enough to continue to support households and businesses, even in severe scenarios”Concluded the report.

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