During a recent speech at the Mansion House in London, Bank of England Governor Andrew Bailey openly expressed his criticism towards Bitcoin and various other cryptocurrencies, labeling them as “extremely speculative assets.” Bailey’s remarks presented a firm stance against the digital asset industry, and he extended his critique to include stablecoins, highlighting concerns regarding their reliability and targeting major players in the industry.
The landscape of digital assets in the mainstream has been undergoing significant changes throughout the year. The initial months of 2023 witnessed the decline of FTX, contributing to an overall negative outlook for the industry. However, as time progressed, traditional finance firms began showing interest in entering the digital asset market, possibly indicating a shift in perception among investors and financial institutions.
Despite these developments, Bank of England Governor Andrew Bailey recently directed his criticism towards the sector, specifically targeting Bitcoin and other cryptocurrencies in a speech. His focus was on questioning the reliability of these assets, encompassing both Bitcoin and stablecoins.
In his speech, Bailey emphasized that stablecoins lack robustness and fail to meet the standards of safe money. Stablecoins are digital assets that are pegged to physical assets such as the US dollar or gold, offering a safer alternative to conventional cryptocurrencies. The US Federal Reserve has even recognized stablecoins as a form of currency in the modern world.
Furthermore, Bailey expressed his belief that digital asset interest will not replace traditional finance. While these kinds of statements are not unfamiliar coming from Bailey, they shed light on the industry’s standing and provide clear reinforcement of the central bank’s perspective on the sector.
Bitcoin Dominates: Market, Value, and Network
BTC not only dominates the market in terms of its market capitalization and value, but it also stands out when it comes to network activity. Recent reports indicate a significant rise in the number of newly created addresses within the Bitcoin network, underscoring its ongoing expansion and growth.
The upcoming halving event, which is eagerly awaited and scheduled for April 2024, is expected to have a positive impact on BTC. According to a recent report by JPMorgan, there is projected to be a surge in retail demand for Bitcoin following the halving. This pattern has been observed multiple times in the past, resulting in a price increase for Bitcoin. Furthermore, several predictions have been made, suggesting that BTC could reach $48,000 before the halving and an impressive $160,000 after the event.