Bank of England governor Mark Carney says cryptocurrencies aren’t a risk to the financial state, but he thinks they will be subject to some form of regulation.
The former Bank of Canada governor and so-called rockstar of finance says cryptocurrencies pose a challenge for market integrity because “a huge amount” of illicit activity is run through them.
His remarks came as he spoke to business heavyweights and economy-watchers at the Public Policy Forum’s Canada Growth Summit in Toronto.
Despite the abuses of cryptocurrencies, he says they aren’t a risk to the financial state because they’re still small and not connected to the financial system.
While still relatively small compared with the established system, he says the emergence of such currencies is part of a broader reorganization of the economy and radically challenging the existing payment system.
He says that at some point, cryptocurrency systems will have to see more regulation.
“There are these exchanges where you transfer your Canadian dollars for a cryptocurrency and those in general are unregulated and in some cases, there’s plenty of serious abuse or at a minimum, they are very porous to a cyber attack and theft and they just do not meet the standards,” he says. “There is no reason why that should be tolerated.”
Carney has previously slammed cryptocurrencies and called on regulators to start monitoring them as they do other financial assets because he says, “being part of the financial system brings enormous privileges, but with them great responsibilities.”