Wed, Mar 14, 2018 – 5:50 AM
Frankfurt
DIGITAL currencies are a revolutionary tool that central banks should consider, but they remain far too risky to be used as legal tender any time soon, according to the Bank for International Settlements.
The BIS – the club of the world’s largest central banks – said in a report on Monday that the new form of money could one day be issued by policy makers for tasks such as settling payments among financial institutions. At the same time, it warned that digital coins might destabilise traditional lenders if offered widely to the general public.
“General-purpose central-bank digital currencies could revolutionise the way money is provided and the role of central banks in the financial system, but these are uncharted waters,” said Benoit Coeure, a European Central Bank board member who chairs the BIS Committee on Payments and Market Infrastructures.
The Basel, Switzerland-based BIS cautioned that much more “experimentation and experience” would be needed before the introduction of central-bank digital currencies, or CBDCs, could even be considered.
As bitcoin and its peers threaten to invade central bankers’ home turf, national…
