The governor of the Bank of Canada thinks Bitcoin is nothing more or less than gambling.
Stephen Poloz, 62, told CNBC he does not believe in the term cryptocurrencies, arguing that new payment technologies like Bitcoin are definitely “cryptos but not currencies.” He made further statements about how Bitcoin cannot be called either an asset or a security due to its zero intrinsic value. At last, the term he thought could suit the digital currency was gambling.
The statement arrives at a time when regulators around the world are struggling to create a definitive legal framework for cryptocurrency ecosystem. They are creating their own definitions for Bitcoin to bring it within any kind of legislative purview. Some are even banning it for imaginary reasons. But in reality, the digital currency has by far proven itself as a multifaceted technology that could assume the role of both a financial and a tangible asset.
Poloz’s statements are extremely important hints towards the nature of upcoming Bitcoin regulations in Canada. It is almost confirmed that Bitcoin ecosystem will be regulated just as gambling ecosystem. At the same time, Poloz confirms that there will be no roadblocks for young Bitcoin and Blockchain startups. Excerpt from the interview:
“I have no doubt that at least for the purposes of consumer protection … We will be developing regulations around this space in due course. But what we are being careful to do here is to not stifle innovation.”
No effect on economy
Poloz also believes that a cryptocurrency crash event would not have any implication on the wider economy. Instead, it will be more like a tech wreck scenario, in which a segment of cryptocurrencies will fail.
“So I think if you take that experience to heart if something like that were to happen in the cryptocurrency space, it would probably be smaller today,” added Poloz. “I don’t want to minimize the risk that you raised because any mania has the scope to get much bigger.”
On being asked about launching a Canadian digital currency, Poloz felt that there is no rush to create national cryptocurrencies. Nevertheless, he confirmed that if Canada ever has one, it would not be needed to be on a blockchain.
Author’s note: Despite not showing the good nature of a random stable fiat currency, Bitcoin and other altcoins can be found being used in exchange for goods and services. Renowned companies like Expedia, Microsoft, Dell, etc. already accept Bitcoin as a payment method. Freelancers around the globe accept it to settle payments online. The fact that cryptocurrencies are being generally accepted or in use makes it a currency; howbeit implausible it may seem.