Bank of England’s Governor, Mark Carney, has spoken about a change in the global financial system with the US dollar being replaced by a cryptocurrency comparable to Facebook’s Libra.
While speaking at the US Federal Reserve’s annual symposium in Jackson Hole, Wyoming, Carney stated that a Libra-like cryptocurrency could substitute the greenback as the global reserve currency.
Carney stated that substituting the greenback with a cryptocurrency would be a more effective option than permitting its reserve status to be substituted by another country’s currency, for instance the renminbi of China.
He further stated that a new “Synthetic Hegemonic Currency” could be offered by the public sector, via a network of central bank digital currencies:
“The combination of heightened economic policy uncertainty, outright protectionism and concerns that further, negative shocks could not be adequately offset because of limited policy space is exacerbating the disinflationary bias in the global economy.”
Last month, Carney opined that Libra, considering the gargantuan vision of the venture, needs to be absolutely error free before it could be considered for worldwide launch. Carney said:
“It’s either successful or it isn’t. If it’s successful, it becomes systemic, because it would involve a very large number of users. And if you’re a systemic payment system, it’s 5-sigma. You have to be on all the time. You can’t have teething issues. You can’t have people losing money out of their wallets.”
Back in February 2018, Carney stated that Bitcoin (BTC) could be hardly considered as a legal currency by conventional definitions. He also opined that it is neither a mode of payment nor a store of value.
