Denis Beau, the deputy governor of France’s central bank, Banque De France, was speaking at the Official Monetary and Financial Institutions Forum conference in London today.
He had a few choice words to say about cryptocurrencies saying that the traditional bank-based ecosystem could face significant changes due to the many technological developments, echoing comments from Fed's Brainard made earlier today.
“With the emergence of so called crypto-assets and so called stablecoins, we may also see new settlement assets develop which may compete against and possibly, according to their promoters, replace commercial and central bank money as settlement assets at the center of our payment systems.”
Beau then goes on to say that central banks really only have three available options to address cryptocurrencies.
1) Completely ignore crypto-assets, which would not mitigate any of the potential risks.
2) Would be to ban all cryptocurrencies. This would be tough as Bitcoin has already been well established in the nation and continent.
3) Is to establish and standardize crypto regulations across the board. This is said to be the prefered option but is proving somewhat difficult as digital currencies are a threat that the banks have not seen before.
Such a prominent banker has rarely given us this kind of insight before. The comments seem to be honest and open. I hope that central banks and digital currency providers can work together to establish a solution but it seems we are far from that point at the moment.
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