Following recent events in China and environmental concerns over Bitcoin’s energy use, Bank of Japan Governor Haruhiko Kuroda criticized the leading crypto asset.
Kuroda says Bitcoin’s volatility is “unusually high”
Bitcoin prices fell again on Friday after a tumultuous week. After hitting a daily high on Thursday at $ 40.125 per unit, Bitcoin (BTC) fell to a low of $ 35.146, losing more than 12% in value. Since then, however, BTC has managed to recover some of its losses and rise above the $ 36,000 mark.
Some of the recent sell-off may have been linked to comments coming from BoJ Governor Haruhiko Kuroda, according to Bloomberg.
The criticism from Kuroda follows recent statements from the Tokyo Metropolitan Assembly, which said it wants to turn the bustling city into a “cryptocurrency trading center”. It looks like Governor Kuroda’s cryptocurrency prediction is completely different.
Bitcoin trading is speculative in nature, the volatility is extremely high. And the asset itself rarely used as a means of settlement. The head of the Bank of Japan, Haruhiko Kuroda, said this in an interview with Bloomberg.
The official stressed that cryptocurrencies should not be confused with stablecoins, the value of which is backed by reserve assets. Stablecoins must meet strict regulatory standards to become a convenient payment tool in the future, he said.
Kuroda also remains committed to quantitative easing. He believes that even after the peak of the pandemic has passed, it is necessary to continue stimulating the economy. In order to get out of the crisis faster.
Recall that the Bank of Japan continues to develop its own digital currency. And is already testing a proof of concept (PoC) for the digital yen. PoC testing expected to last until March next year.
Kuroda joins central bankers in criticizing digital gold
Kuroda arguably opposed to Bitcoin because of the climate change discussions in this week. Central banks around the world not only criticize Bitcoin, but many banking leaders these days are also tackling climate change issues. Kuroda of the Bank of Japan said the central bank “very interested” in addressing these climate issues.
Earlier, the Governor of the National Bank of Denmark Lars Rohde, called cryptocurrencies a “speculative fad” that can be ignored. According to him, they do not pose a threat to monetary regulators – the real threat comes from bigtech companies.
“If tech giants master the means of making transactions, it could be a real threat to the autonomy and independence of central banks,” Rohde said.
Recall that in May 2021, the Governor of the Bank of England, Andrew Bailey, said that cryptocurrencies have no intrinsic value. So, investing in them associated with serious risk.
In the same month, the head of the European Central Bank, Christine Lagarde, warned that some digital assets “predisposed” to the risk of money laundering.
Kuroda’s Bitcoin statements also follow the country’s gaming giant Nexon buying 1,717 BTC. Contrary to Governor BoJ’s statements, Nexon recently said, “Bitcoin offers long-term stability and liquidity while preserving the value of our cash for future investments”.