Andrew Bailey just issued a warning to everyone holding Bitcoin.
The Bank of England governor-designate, who begins his term on March 16, 2020 and who served as the bank’s deputy governor from April 2013 to July 2016, took a hard stance against Bitcoin (BTC) in a new speech on Wednesday before the U.K. Parliament.
Bailey echoes other outspoken crypto critics like legendary investor Warren Buffett, economist Nouriel Roubini and gold supporter Peter Schiff who have warned investors against owning Bitcoin. Bailey initially equated buying Bitcoin with gambling in an interview with BBC’s Newsnight in December of 2017, calling it “a very volatile commodity in terms of its pricing.”
Now, the central banker is doubling down on his skepticism of the digital asset, saying it has zero intrinsic value.
“There’s no guarantee of the value of Bitcoin… If you want to buy Bitcoin, be prepared to lose all your money. If you want to buy it, fine, but understand what you’ve got. It has no intrinsic value. It may have extrinsic value but it has no intrinsic value. That’s one point. It hasn’t caught on.”
His remarks follow a recent report from the Bank for International Settlements (BIS) that analyzes the impact that virtual currencies, including Bitcoin, may have on the world of finance.
According to the report, the technology behind cryptocurrency is groundbreaking, and central banks are “increasingly exploring the desirability and feasibility of establishing their own peer-to-peer systems through digital currencies.”
“The most transformative option for improving payments is a peer-to-peer arrangement that links payers and payees directly and minimises the number of intermediaries. Many peer-to-peer arrangements use distributed ledger technology (DLT).
Whereas account-based systems record transactions in a central ledger, DLT systems record transactions in multiple places at the same time, resulting in a decentralised, synchronised ledger. Examples that have garnered attention in recent years include Bitcoin and so-called “stablecoin” initiatives like Libra.”
Featured Image: Shutterstock/pathdoc