Jakarta, CNBC Indonesia – Digital currency cryptocurrency or crypto is still loved by many people in the world, even now it has become a means of payment for many things because it is considered to have value like conventional currency and is more efficient.
Moreover, the devotees of crypto coins Bitcoin, Solano, Ethereum and others like crypto because there is no need for a central bank as physical currency rules.
A number of figures also opened their voices about this crypto penetration. Russian President Vladimir Putin says crypto is indeed becoming more and more rampant, though he says he’s not convinced cryptocurrency can replace the United States (US) dollar in oil trading, for example.
This was stated in an interview in Moscow, Wednesday (13/10/2021). “It’s too early to talk about trading in energy resources in crypto,” said Putin, when asked if the digital currency could be used as an alternative to the US dollar, quoted from CNBC International, Friday (15/10).
“I believe it has value. But I don’t believe it can be used in oil trading,” he continued.
Putin says cryptocurrency don’t have any support yet. “It may exist as a means of payment, but I think it’s too early to say about trading oil in cryptocurrencies,” he added.
The Russian leader also flagged crypto’s massive energy consumption as a potential barrier to its use. Bitcoin requires a lot of computing power to process transactions and print new tokens.
However, Putin did not mince words about Russia’s efforts to move away from dependence on the US dollar.
“I believe the US made a big mistake in using the dollar as an instrument of sanctions. We were forced to. We had no other choice but to switch to transactions in other currencies,” he admits.
“In this case, we can say the United States bites the hand that feeds it,” Putin added. “This dollar is a competitive advantage. It is a universal reserve currency, and the United States is currently using it to pursue political ends, and as a result they are harming their strategic and economic interests.”
Central Bank
In addition to Putin, the Bank of England’s Deputy Governor for financial stability, Jon Cunliffe, gave a new message for cryptocurrencies. He said the digital currency must be regulated in order to avoid financial threats.
Citing CNBC International, in his speech on Wednesday (13/10/2021), Cunliffe said that the growth of cryptocurrencies was extraordinary. Five years ago the crypto asset market was worth US$16 billion, but today crypto is at US$2.3 trillion.
“When something in the financial system is growing really fast, and growing in a largely unregulated space, financial stability authorities have to sit back and pay attention,” he said.
He added that crypto assets currently still raise concerns about financial stability problems because they are considered to have no intrinsic value and are vulnerable to deep price corrections.
“The question going forward is what can result from such an event, if these crypto assets continue to grow at scale, if they continue to become more integrated into the traditional financial sector and if investment strategies continue to become more complex?”
Furthermore, Cunliffe stressed that financial regulators around the world must take a stand in regulating the digital currency as soon as possible. The reason is that he said crypto has become the interest of many people, but the stability of the price of the digital currency has not been fully formed.
“While crypto finance operates in a new way, well-designed standards and regulations can and should allow risk to be managed in the crypto world as it is managed in the traditional finance world,” he added.
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