At Amsterdam’s Money 20/20 Conference on 5 June, bank representatives from four countries were asked to respond to the question “Can cryptocurrencies spell the end of fiat currencies?”, reports Cointelegraph.
During a panel discussion, representatives from Swiss National Bank, the Bank of Lithuania, the Bank of England, and the Bank of Canada took turns in expressing their views on the topic.
The responses were generally in agreement, with Bank of Canada’s James Chapman suggesting that this situation would only occur in a hyperinflation scenario, with Swiss National Bank’s Thomas Moser concurring that a poor fiat performance may well invite more cryptocurrency activity, but argued that “as long as central banks do a good job, there is no real for central banks to disappear”.
Switzerland is now well known as a crypto hub, as reported in Bitcoin News recently, and has achieved widespread adoption across the alpine nation. Moser clarified this suggesting that so far it had been “well tolerated” due in part to the crypto haven tag and a balanced approach to initial coin offerings (ICOs) and had become an attractive fintech magnet for many companies.
Martin Etheridge, head of division at the Bank of England, somewhat hedged his bets expressing, “who knows what the future will hold”, although he did say that he saw little prospect of fiat being overtaken or replace by cryptocurrency:
“[But] I think the odds are stacked very much in favor of fiat currencies. I think it would take a pretty fundamental shift of public perception or the existing market system for it to happen.”
Dr Marius Jurgilis of the Bank of Lithuania clarified that a central bank-issued cryptocurrency and a cryptocurrency are not the same things, adding that the main product of a central bank is “a matter of trust”:
“…but if the society starts questioning, or it if it thinks that the things we are selling could be got in a cheaper, more convenient way, other things will appear.”
He added it was this level of trust that his country’s banks were guarding while admitting that the bank’s position was not totally entrenched. In mid-April, Lithuania’s central bank reportedly began looking into cryptocurrencies, round tabling points of view from all sectors, including regulators and investors.
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