ZURICH: UBS chairman and former Bundesbank president Axel Weber said on
Wednesday bitcoin does not fulfil some of the most important functions of
currency, the latest senior banker to express scepticism about the
cryptocurrency.
“I get often asked why I’m so sceptical about bitcoin, it probably
comes from my background as a central banker,” Weber said at a conference
organised by the Swiss Finance Institute.
“The important function of a currency is, it’s a means of payment, it
has to be generally accepted, it has to be a store of value and it’s a
transaction currency. Bitcoin is only a transaction currency.”
Weber’s comments follow JPMorgan Chase & Co Chief Executive Jamie
Dimon last month saying bitcoin ”is a fraud” and will blow up.
Bitcoin is a digital currency that enables individuals to transfer
value to each other and pay for goods and services bypassing banks and the
mainstream financial system.
While banks have largely steered clear of bitcoin since it emerged
following the financial crisis, the virtual currency has a range of supporters,
including technology enthusiasts, libertarians sceptical of government monetary
policy and speculators attracted by its price swings.
Weber was more upbeat about blockchain, which was first developed to
power bitcoin and is a shared ledger of data that is maintained by computers
rather than a central authority, and said over time the idea of a digital
ledger would be widely accepted.
Earlier on Wednesday, Commerzbank AG, Bank of
Montreal, Erste Group Bank AG and CaixaBank SA said they had joined an
initiative launched by UBS and IBM Corp aimed at building blockchain-based
technology to support trade finance transactions. – Reuters
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