Recently Bank of England released it’s Annual Report and Accounts 1 March 2017–28 February 2018. In document word ‘crypto-assets’ was mentioned 11 times which is way more than in any public accessable document previous year. Here’s the thing you might want to know.
The bank is continuing to assess the implications of crypto-assets
In report by the Governor Mark Carney it is said that along with concern about the risks crypto-assets might pose on issues such as money laundering and investor protection the FPC judged in March 2018 that existing crypto-assets do not currently pose a material risk to UK financial stability. The Bank is, however, continuing to assess the implications of crypto assets in co-ordination with other national and international authorities including FSB and G20.
Crypto-assets themselves are unlikely to be the future of money
Bank of England is trying to form an opininion that banking sector is not going anywhere, they just need to evolve current banking system to more trusted, faster and more convenient for users:
Their (crypto-assets) existence underscores society’s growing demands for fully reliable, real-time, distributed peer-to-peer transactions. As part of the solution, reforms of the Bank’s payment systems are underway.
Bank of England aim: To deliver a service which responds to the changing structure of the financial system while maintaining high resilience
Earlier this year the Bank took over the direct running of the UK’s CHAPS high value payment scheme, providing strengthened end-to-end risk management. Bank have launched a proof-of-concept to understand how RTGS (Real-Time Gross Settlement System) could be capable of supporting settlement in systems operating on innovative payment technologies, such as those built on distributed ledger technology. Bank of England have allowed non-bank payment system providers to access RTGS for the first time.
Crypto-assets may impact how Bank of England maintain monetary and financial stability
Bank of England admits that some of the underlying technologies behind crypto-assets are highly innovative, and in time could enhance financial stability, support more efficient and reliable payment systems, and have wider applications far beyond their origins.
Bank is in the process of clarifying how the existing regulatory requirements — including for capital — which institutions at the core of the financial system must meet, should also apply to any future crypto-asset activity undertaken and exposures acquired. Bank of England is also working with the FSB and G20 on these issues given the diversity of possible approaches and the decentralised and cross-border nature of crypto-assets.
Despite the fact cryptocurrency markets are not living it’s peak it is clear that banks are trying to be vigilant and deeply focused on crypto-assets.
Do banks care about cryptocurrency?
Do banks care about other banks?
Do cryptocurrency investors still care about banks?
Answer to yourself.
Image courtesy of https://business-reporter.co.uk