England has been a less than ideal place for cryptocurrency investors and users. Last year, the private banking syndicate operating in the UK discouraged their clients from using cryptocurrencies by issuing several warnings for their consumers and banning the use of cryptocurrency trading from their bank accounts.
In the same vein, the governor of the Bank of England, Andrew Bailey, recently claimed that Bitcoin’s position as a mode of payment raises questions.
With his recent statement, the governor has joined the rank of the Central Banking enterprises around the world that are at odds with cryptocurrencies.
One of the most popular clashes with cryptocurrencies is noticed in India, where the Reserve Bank of India’s intervention in the local cryptocurrency sector has resulted in the imposition of a 51% tax implementation.
Bitcoin’s Utility as a Mode of Payment
BoE governor made an appearance on a podcast recently when he claimed that Bitcoin does not offer any intrinsic value. It is worth noting that at present, more fiat currencies like USD and Pound are not backed by any reserve like gold or other trade commodities.
The Central Banks in the respective region can print as many new notes as they like and control the value of their fiat currency independently.
Bailey also claimed that he does not see Bitcoin becoming a popular mode of payment for everyday transactions. On the other hand, a few sovereign nations such as Panama, El Salvador, and CAR are some of the countries that have already constitutionalized Bitcoin as a legal tender under their jurisdiction.
As per Baily, the use of Bitcoin as a legal tender is not viable since it is not a practical proposition for most digital currency investors and holders.
The governor of the Bank of England is not the only financial giant from the western bloc that has opposed the Bitcoin status as a mode of payment.
There are statements from European Central Bank president Christian Lagarde who recently made comments along the same lines. Lagarde iterated her earlier stance towards cryptocurrencies claiming that cryptocurrencies do not possess any underlying value and it is often subjected to market speculation.
Swiss Banking enterprise Riksbank posted a Twitter thread that commented on how cryptocurrencies are not a viable mode of payment and cannot be classified as real money.
At the same time, the people in the cryptocurrency sector, such as Sam Bankman-Fried, also claimed that Bitcoin does not have a long-term future, highlighting the issue with scalability.