Bank of England Chief Economist Andy Haldane advocated for the potential benefits digital currencies can offer in a recent speech given at TheCityUK 10th Anniversary Conference on Wednesday (Nov. 18).
Haldane said the adoption of digital currencies would cause a structural shift in monetary policy, and more consideration should be given to its potential benefit.
A sitting member of the Monetary Policy Committee, Haldane said that introducing a digital currency could lead to something closer to “narrow banking,” where safe payments are separated from “banks’ riskier credit-provision activities.”
While recognizing that digital currencies do pose risks, including the possibility of imposing “a macro-economic cost,” Haldane argued that a digital currency could mitigate technological constraints on lending, provide additional payments security, and increase stability.
“I believe it is important these potentially large macro-economic benefits of a digital currency are explored when evaluating the case for a new monetary order,” he said. “So far, that has not been the case.”
The future of digital currencies, Haldane said, is uncertain and most likely varied.
“If history is any guide, a co-evolutionary path is likely, with an eco-system of diverse and competing payments media and systems emerging, some wholesale, others retail, some private, others public,” he said.
Meanwhile, online gamblers are taking advantage of bitcoin’s surging prices to cash out their winnings in cryptocurrency, Bloomberg reported.
“Right now 90-95% of our payouts are people asking for Bitcoin because it’s going up,” Phil Nagy, CEO of Winning Poker Network, told Bloomberg, requiring the network to buy “millions of dollars worth of bitcoin,” Bloomberg wrote.
In other news, the U.S. Department of Homeland Security has given Conor Freeman, of Ireland, three years of jail time for his role in an online scheme that robbed victims of more than $2 million in cryptocurrency, according to the Irish Times.
Freeman allegedly worked with five co-conspirators. Using social media, they would identify victims who might be in possession of cryptocurrency, obtain their phone numbers, transferr them onto new SIM cards, and then gain access to their emails through the forgotten password option.
By examining past email exchanges, Freeman would identify cryptocurrencies in the victims’ possession.
Freeman pleaded guilty to three separate instances of stealing cryptocurrency from victims, knowingly engaging in the possession of criminal proceeds, and three counts of dishonestly operating a computer.
Freeman turned in his share of the cryptocurrency, which is now valued at over $2 million.
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