The bank of international Settlements negated the statement made by the central bank regarding cryptocurrencies. During the early months of the current year stated that cryptocurrencies were not good for financial stability. BIS conducted a study on the news on regulations and their effect on cryptocurrencies. It found that news, which covers legislation, triggers higher market gains.
In addition, it was found that cryptocurrencies markets depend on legislated financial institutions for its operations so that cryptocurrencies must be linked to the state regulations. So whenever any news and declaration is released, the prices of cryptocurrencies will move up and down. Therefore, it can be said that cryptocurrencies depend on regulated financial institutions. Though BIS commented that cryptocurrencies do not put the financial system on instability risk, but it suggested controllers keep it in check and keep an eye on possible pressures.
Through this research, BIS negated the statement made by the central bank. However, previously it was also against the cryptocurrency. On so many occasions official of BIS mage many statements against cryptocurrencies. Like Agustin Caresten considered Bitcoin as a disaster for economy and environment. He called it Ponzi scheme a number of times.
But, BIS was also against the launch of CBDC. In March, BIS commented that cryptocurrency could raise many issues for the financial and economic system. Therefore, CBDC should keep an eye on digital currencies. The chairperson of BIS Jacqueline Loh stated in this regard that for the launch of CBDC, special care was required. So many statements made by BIS official contradict their new findings.
