The president of the central bank of Denmark has invited savers to stay away from Bitcoin, citing the presence of a speculative bubble around the cryptocurrency.
A "dangerous" asset
As the Danish state-owned radio and television company DR reported, Lars Rohde, the director of the National Bank of Denmark, explained that Bitcoin was "dangerous".
He believes that an investment in this digital currency was similar to participating in a gambling game: "If you do not like casinos, this is a good alternative."
Here is what he also said:
"Bitcoin makes me think of tulipomania, it's like a bubble out of control.
It refers here to the first speculative bubble of finance, which had shaken the entire Dutch economy by causing a disproportionate increase and then a collapse of prices of tulip bulbs. In the middle of the seventeenth century, the price of each of these bulbs had reached up to ten times the annual salary of a specialized craftsman.
To read also:
"Bitcoin, a speculative bubble about to burst?"
"What would be the consequences of a collapse of the 'bubble' Bitcoin?"
No protection for small savers
Protecting savers The manager explained that the markets on which Bitcoin is traded were "totally unregulated," and that the authorities could not offer any protection to savers.
These statements follow a report published a few days ago by the National Bank of Denmark. It stated that the introduction of a digital currency, issued by the central bank, would not offer payment solutions more interesting than those used today.
The state agency said the issuance of such a currency could also threaten the country's financial stability:
"In view of the situation in Denmark, it is difficult to know how a digital currency issued by the central bank could provide additional alternatives to what is already possible with current payment solutions," could we say? read there.
"Glass beads"
Glass beads In 2014, Denmark's central bank compared Bitcoin to "glass beads" - referring to pearls that were once traded for gold, ivory and other raw materials. It had also stated that Bitcoin was not a currency, as it was not supported by an issuing body.
This is a point of view similar to that recently raised by the Governor of the Banque de France, François Villeroy de Galhau. A few weeks ago, he said in a financial forum: "We must be very clear: Bitcoin is by no means a currency, not even a cryptocurrency."
Fear of the unknown. It suits him that he wants to protect the savings of his fellow countrymen but I don't think he knows what he's talking about.
I've been thinking about keeping my mouth shut about my crypto investments during the coming Xmas dinners because I don't want to have to explain what it is all about: blockchain (I am glad my father understands the concept of the cloud!), the fact that money isn't based on anything but debt, kept in existence by governments to prevent the economy from collapsing, decentralized communities (to most that is a contradiction in terms)... neh, I'll keep it calm and cozy this year :-)
I'll keep my mouth shut and wait for the moon!
Happy 2018!
well said i agree with you
Happy 2018!
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Nice find! The futures of bitcoin definitely could cause a sudden drop. But no risk no reward.