Bank of England Warns About Bitcoin Price Falling to Zero
Sir Jon Cunliffe, the Deputy Governor of the Bank of England, has stated additional cautions about cryptocurrency investments, including bitcoin (BTC). On Tuesday, the official stated that digital assets might lose all of their value. Its price can change significantly and, “practically, could drop to zero,” Cunliffe stated, referring to the Bank of England’s “Stability Report” released on Monday.
He believes that the point at which one should be concerned is when the financial system is integrated. A significant price correction might have a significant impact on other markets as well as established financial industry participants. The risk may not exist yet, but developing standards and laws takes time, according to Cunliffe.
By the time bitcoin becomes a much greater concern, he believes the Bank of England has to be ready with a regulatory framework to minimize hazards. Cunliffe believes the risk point is approaching, and he has asked regulators and lawmakers to consider it.
In a similar vein, the Bank of England stated in its December 2021 Stability Report that around 95% of total cryptocurrencies, which includes bitcoin, lacked the backing of underlying assets and hence have no inherent value. As a result, it warns that these assets are susceptible to large market declines, and as a result, investors may lose their investment.
Andrew Bailey, the governor of the Bank of England, remarked in an online forum in January that he did not believe there was a cryptocurrency architecture that could persist over time.
According to CriptoNoticias, Bailey stated that the price volatility of Bitcoin will prohibit against sustaining its value over time because payments will need a “stable currency.”
Since 2010, several experts have rehashed the arguments of the Bank of England to anticipate the loss of bitcoin’s utility. According to CriptoNoticias, the largest Cryptocurrency has been proclaimed “dead” over300 times by 2018. This amount is presently 436 times, as per 99Bitcoin, a service that analyses public assertions that bitcoin “would end up at zero.”
The Cryptocurrency reached a high of around $67,000 during November but plummeted once the Omicron variant of the coronavirus was discovered before stabilizing around its present level in the last week.