BIS CEO: Central Banks May Problem Digital Currencies ‘Sooner Than We Think’

After authorizing comments and reports heavily crucial of cryptocurrencies over the last few years, Agustin Carstens, chief of the Bank for International Settlements (BIS), has acknowledged that central banks will most likely soon need to problem their own digital currencies.

Speaking to the Financial Times on Sunday, Carstens declared that BIS – which acts as a central bank for central banks – is supporting global central banks’ efforts to research and build digital currencies based on national fiat currencies.

Several central banks are engaged in such work and “we are working on it, helping them,” Carstens said. Further, the arrival of such products might just around the corner if there is clear proof of demand from the public.

Based on Carstens:

The comments come shortly after Facebook’s unveiling of its organized Libra cryptocurrency made headlines and shook regulators worldwide, as the prospect of a tech firm with users in the billions starting his own money potentially poses a threat to state currencies.

France’s finance minister has said that Libra should not be allowed to become a sovereign currency.

Over in the U.S. Congress woman, Maxine Waters has asked Facebook to halt the growth of the Libra Network until hearings can be kept.

BIS itself name-checked Facebook in its recent annual report, expressing fears that initiatives like Libra pose a long-term threat to central banks control of money:

Talking to the FT, Carstens again addressed the Facebook problem.

“The issue is how will the currency be used? Will there be the discovery of data, or information that can be used in credit provision and how will data privacy be protected?” he said, adding that a “simple way” to control such cryptocurrency networks is to start addressing “immediate and very obvious” money laundering concerns.

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