- BoE policymaker believes cryptocurrency could be good for financial stability in the UK.
- Mr. Haldane dedicated 19 pages worth of transcript to describe what possibilities there could be for cryptocurrency in the future.
- One of the advantages the policymaker noted was that it would help them pursue their aims of narrow banking where they can segregate their banks.
BoE is rooting for cryptocurrency
BoE policymaker believes cryptocurrency could be good for financial stability in the UK. The Bank of England is looking at digital currencies from a whole new lens.
The central bank is checking out how cryptocurrency could help them with their new monetary order. Chief economist, Andy Haldane who is also a part of the BoE’s monetary policy, announced via a speech yesterday at TheCityUK 10th anniversary conference.
Mr. Haldane dedicated 19 pages worth of transcript to describe what possibilities there could be for cryptocurrency in the future. In his speech, the policymaker spoke about numerous topics regarding crypto and their influence in creating financial stability as well as policy.
Mr. Haldane did acknowledge digital currencies would certainly be a new way of doing things but encouraged people to focus on the long term benefits crypto could accrue.
He also described the currency as widely used and pointed to its growth and potential of being mainstream. One of the advantages the policymaker noted was that it would help them pursue their aims of narrow banking where they can segregate their banks.
Narrow banking would look like separating the safe payment activities from the more dangerous credit business. Mr. Haldane said being able to focus on their narrow banking strategy would help businesses create a closer alignment of risk and duration on balance sheets.
The central bank would be able to prevent negative interest rates from occurring. Mr. Haldane explained that zero bound or negative rates are due to a technology limitation on paying or receiving interest on cash.
