Crypto Crash Survivors Could Become Tomorrow’s Amazons, BOE Says

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Crypto Crash Survivors Could Become Tomorrow’s Amazons, BOE Says: According to Jon Cunliffe, Deputy Governor of the Bank of England, the survivors of the recent bear market in crypto-assets have the potential to become the technological businesses of the future that can compete with Amazon.com Inc. and eBay Inc.

Cunliffe drew parallels between the recent decline in the value of Bitcoin and other cryptocurrencies and the dot-com bubble that burst at the turn of the millennium. This year’s crisis has reduced the value of Bitcoin and other cryptocurrencies by more than one trillion dollars.

At the Point Zero Forum in Zurich on Wednesday, Cunliffe stated, “The analog for me is the dot-com boom when $5 trillion was wiped off values.” Cunliffe was referring to the period after the dotcom boom. “A great number of enterprises went out of business, but the technology did not. It reappeared ten years later, and the companies who were able to weather the storm — Amazon and eBay — emerged as the most successful competitors.

Even if the market is currently unstable, he emphasized that cryptography has “great applications and promise within the financial industry.” This is despite the fact that the market is currently unstable.

“I anticipate that cryptocurrency technology and finance will persist regardless of what happens to crypto-assets over the course of the next few months,” Cunliffe said. “It has the potential to bring about massive efficiencies as well as shifts in the structure of the market.”

The Bank of England (BOE) is in the process of formulating plans for its very own retail central bank digital currency, and it expects to distribute a consultation document before the year is up.

One of the most important questions that are being asked is whether or not it would be better to build a fully autonomous CBDC that has an “on or off-ramp to fiat” money or simply “something that is flexible enough” to be utilized in private stable coins.
Cunliffe provided an example of stablecoins that are included in the supply chain and logistics systems in order to achieve the highest possible level of productivity. He stated that “we couldn’t provide something that performs all those things,” and I quote: “We were unable to.”

“The question that needs to be answered is, would you be better off having private stablecoins to be more optimized in particular areas, which would then link back to a central bank ledger in some way? Or, should we serve as the foundation?” Cunliffe said.

The large philosophical question that authorities must decide is whether or not to allow “completely disintegrated settlement,” which would require them to regulate the AI code that is at the heart of cryptocurrency technology.

“I have the same faith in that as a completely automated pilotless jet from London to Zurich or a totally driverless automobile,” he said. “I have the same confidence in that as a fully automated pilotless plane from London to Zurich.” “I want to know where the liability lies in the event that the algorithm malfunctions and causes me to crash. In the not too distant future, I get the impression that will be a very challenging obstacle for the regulatory system to overcome.