Global exchanges should strive to provide a safe and regulated alternative to private cryptocurrencies, the former London Stock Exchange boss said, as demand for bitcoin and other digital assets continues to grow.
Xavier Rolet said Financial news that there is an “urgent need for a well-regulated global digital currency, supported by a sound and legally secure financial infrastructure”.
The use of cryptocurrencies has proliferated among retail and institutional investors, with the global cryptocurrency market hitting an all-time high of $ 2.9 billion in November, according to data from CoinMarketCap. But the market remains largely unregulated, and several major exchanges, including Coinbase, Kraken, and Binance, have clashed with regulators in recent months.
Central banks are keen to avoid the possibility of rivalry with government-issued money, as countries and regions like China, the European Union and the UK consider developing their own digital currencies.
âThe so-called cryptocurrency and its exchanges have grown in leaps and bounds outside of a clear and secure regulatory framework that the old global exchange industry could provide,â said Rolet.
“Will anyone have the courage to bridge the gap and both enter the 21st century?” “
Rolet, who is also the former chief executive of asset manager CQS, previously said the central bank’s plans were limited by their national borders and might not go far enough to completely stop the tide of cryptocurrencies such than bitcoin and ether.
READ Xavier Rolet: How central banks could end the crypto experiment
In June, he suggested that the mandate of the International Monetary Fund could be extended to include the creation, issuance and administration of a global digital currency based on the Special Drawing Rights regime.
It would also use the regulatory umbrella and technological architecture managed by members’ central banks, he said.
Groups such as the influential Basel Committee on Banking Supervision have attempted to help regulators and banks tackle cryptocurrencies, proposing in June that any financial institution managing cryptoassets should be required to support such cryptocurrencies. holdings one by one.
The proposal prompted a backlash from banks, including JPMorgan and Deutsche Bank, who said the 100% capital requirement was unreasonable. The Basel Committee has undertaken to review its recommendation.
READ Banks oppose strict Basel rules governing cryptocurrencies
About 85% of institutional investors and wealth managers now have dedicated cryptocurrency review teams, a survey by Nickel Digital Asset Management found on December 8.
Of those interviewees, about a fifth had only created their crypto teams in the past three months. Of those who do not currently have a dedicated digital assets team, only 7% said they do not plan to create one in the future.
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