Central Bankers Question Cryptos at Davos

Central bankers meeting at a roundtable discussion at Davos, organized by the World Economic Forum (WEF), have questioned crypto’s place in the global economy. 

Some of the comments emanating from a panel of central bankers and regulators are that stablecoins are unstable and that cryptocurrencies do not act like real currency. 

Cryptocurrencies, like Bitcoin and Ethereum, have recently lost massive amounts of value, joining stablecoins like Luna and TerraUSD on a downward spiral. 

Kristalina Georgieva, managing director of the International Monetary Fund (IMF), said that Bitcoin may be a coin, but it is not money. She added that some cryptocurrencies are more akin to a pyramid scheme because they are not backed by “real” assets. 

Central Bank of France Governor François Villeroy de Galhau stated, “Cryptocurrencies are not a reliable means of payment. Someone must be responsible for the value, and it must be accepted universally as a means of exchange. It's not.” Meanwhile, Sethaput Suthiwartnarueput, a governor with the Bank of Thailand, noted that cryptos are more of an investment than a medium of exchange.

What does this mean for me? 

Judging by these comments, cryptocurrencies have a long way to go before they can be accepted by the mainstream. However, the panelists agreed that cryptos will eventually evolve and become more ordinary for consumers.

As a crypto investor, you will know that the timeline to crypto acceptance is not clear. While many of the influential panelists questioned the mechanics of cryptocurrencies, they agreed that cryptos are here for the long haul.