The Swiss Bank for international settlements (BIS) on June 17 published an annual economic report, which included a 24-page text, titled “Cryptocurrency: an attempt to look deeper than the superficial hype”. In the article, designed in a very critical tone, the staff of the BIS, said that the bitcoin and its analogues endowed with a number of disadvantages, not allowing the cryptocurrency to meet the expectations that caused them the explosive interest and led to the inflow of investments in this potential asset class.
How to write Bank experts, the cryptocurrency is too unstable, consume too much electricity, easily manipulated and vulnerable to fraud, which generally is unlikely they ever be the means of calculation in the global economy. The authors believe that the decentralised nature of cryptocurrency — rather, their fundamental flaw, not a virtue.
Perhaps one of the most painful discoveries of the Bank’s specialists was the conclusion to which they came as a result of trying to figure out how much power we’ll need the block chain for processing retail transactions that are now engaged in a national payment system. It turned out that, since the size of numerous registries increases, ultimately blackany capture everything from smartphones to servers.
The report says:
The increase in transmitted information may cause the collapse of the Internet.
The researchers also noted that competition between miners for the first opportunity to handle transaction “consumes” the same amount of electricity as the whole of Switzerland:
To put it as simply as possible, the desire for decentralized trust very quickly degenerated into a disaster.
Representatives of the BIS recognized that blockchain technology a distributed registry have certain benefits for the global financial system. For example, they are able to increase the efficiency of international payments. In addition, in their opinion, the calculations of the international trade transactions within the framework of export and import, which is still relevant and phototelegram of a letter of credit, is ripe for the introduction associated with bloccano.
However, in the end, the authors of the report conclude that a revolutionary feature of bitcoin — the possibility to send values from person to person with the same ease as email — is also its Achilles heel. They believe that to put the global economy dependent on a decentralized network too risky for many reasons.
The authors of the report conclude:
The trust may at any time come to an end because of the fragility of decentralized consensus by which transactions are recorded. Thus not only questioned the final character of the payments, but there is a risk that the cryptocurrency can just cease to function, leading to a complete loss of values.
The Bank for international settlements was created in Basel in 1930. It is an international financial institution, whose function it is to promote cooperation among Central banks and to facilitate international financial transactions.