The Bank of England wants to focus more on money laundering with crypto currencies in the future. This was announced by the Governor of the Central Bank of the United Kingdom this Friday at the Scottish Economics Conference. He stressed that in future the same conditions should apply to crypto currencies as to other financial instruments. In the past, the British government had recently expressed increasing concern about the potential use of crypto currencies in organised crime, terrorist financing and money laundering.
“A Brave New World” – this was the motto of the premiere of the Scottish Economics Conference this Friday. For Mark Carney, the Governor of the Central Bank of the United Kingdom, who was invited as the main speaker, crypto currencies were not part of this conference. In his speech on the future of money, he painted a somewhat enthusiastic picture of crypto currencies as digital payment alternatives of the future, instead emphasizing their dangers and shortcomings.
And this Bitcoin revolution would be mainly due to the dangers of their criminal potential
The 52-year-old Canadian warned the Scottish national economist Adam Smith quoting that although the students’ enthusiasm for Bitcoin revolution & Co. was great, they still did not live up to the demands of monetary theory.
“How well do crypto currencies fulfil the role of money? The short answer is that they fail.”
On the one hand, this is due to the lack of stability of value. On the other hand, the inefficient exchange and the low possibility of conventional payment hamper the benefit.
Although the technology currently has great learning effects for governments, it still needs legal answers.
“At present, cryptographic facilities contain a variety of problems within consumer and investor protection, market integrity, money laundering, terrorist financing, tax evasion and by evading these capital controls and international sanctions, he said, reflecting the concerns of the UK government. Recently, Prime Minister Theresa May had warned at the World Economic Forum in Davos against the criminal use of crypto currencies and emphasised that they would deal “very seriously” with them.
As worried as this may sound, the Bank of England would nevertheless refrain from a ban. Rather the time had come to occupy crypto currencies with the same conditions and standards as other financial instruments. Without these, a threat to financial stability would be quite conceivable, Carney said.
“In the future, risks to financial stability could increase if seller participation or integration into the conventional financial sector were to increase without this leading to improvements.
Bitcoin loophole – Blessing one curse and blessing another
The forthcoming Bitcoin loophole review in Buenos Aires should now provide answers, joint coordination and talks on possible regulation, Carney stressed. The Bank of England is not alone these days in its concern for anonymity within the Bitcoin loophole crypto-circle of currencies.
Last month, Federal Finance Minister Peter Altmaier and his French counterpart Bruno LeMaire had already urged in a joint letter to put crypto currencies on the agenda of the upcoming summit in Argentina. There it was important to develop international solutions to deal with the newly emerging crypto trade in the future. IMF chief Christine Lagarde, on the other hand, had last month called globally coordinated regulation “inevitable”. She, too, pointed out that regulations must focus more on the user than on the currencies themselves. In the past, Lagarde had often warned against the criminal potential of crypto currencies.
In the recently published annual report 2017, the European police authority Europol also complains about the increased use of crypto currencies. These would make cross-border work in the fight against organised crime with drugs, passport documents or weapons much more difficult.