BIS Chief Agustin Carstens says Crypto Lost Battle to Fiat

BIS GM Agustin Carstens stated recent developments have led to severe doubts regarding stablecoins’ ability to serve as currency.
BIS Head says Crypto Lost Battle to Fiat

The general manager of the Bank for International Settlements (BIS), Agustin Carstens, says the “battle has been won” between fiat and cryptocurrency, and vigilance is no longer needed.

In a Bloomberg TV interview, BIS general manager Agustín Carstens stated, “technology doesn’t make for trusted money.” 

The BIS GM noted, “Only the legal, historical infrastructure behind central banks can give great credibility to money.” His statements come after the recent back-to-back debacles in the crypto sector. 

“What this view forgets is that what sustains fiat money is not the application of novel technologies but all the institutional arrangements and social conventions behind it. And it is precisely these arrangements and conventions that make money reliable for the public,” Carstens added.

Carstens explained how recent developments have led to severe doubts regarding stablecoins’ ability to serve as currency. Stablecoins, he pointed out, depending on the legitimacy of fiat with fewer regulatory safeguards, thus they cannot guarantee the integrity of money.

Central bank digital currencies (CBDC), and tokenized deposits, according to Carstens, could promote efficiency. He suggested a public-private partnership approach for a single blockchain where CBDCs are trusted by a central bank.

These anti-crypto statements by Carsten didn’t sit right with the crypto community. NSA whistleblower Edward Snowden tweeted snarky remarks against Carstens saying “man couldn’t even win the battle against the international house of pancakes and he’s out here trying to eulogize his enemies.”

Certain crypto enthusiasts didn’t forget to highlight Carsten’s statements about CBDCs as they believe the government-regulated tokens defy the meaning of decentralization and financial privacy. 

Also Read: The Soul of Money Belongs Neither to a Big Tech nor to an Anonymous Ledger: BIS Chief

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