Cryptocurrencies like Bitcoin fail to mitigate risks. but in turn extending financial risks in emerging market countries According to a study published by Bank for International Settlements (BIS)
On August 22, the Advisory Group of the Directorate on Financial Stability (CGDFS)publishNew report on cryptocurrencies titled “Risks of Financial Stability from digital assets in emerging market countries.”
The study was conducted by BIS member central banks within the CGDFS, including central banks in Argentina, Brazil, Canada, Chile, Colombia, Mexico, Peru and the United States. The document emphasizes that The views expressed are the opinions of the authors and “not necessarily the views of the BIS”.
The authors of the report stated that Cryptocurrencies like Bitcoin are a fast solution to emerging market financial challenges.
“Currency It is promoted as a low-cost payment solution, an alternative to accessing the financial system, and a replacement for national currencies in countries with high inflation or high exchange rate volatility,” the study states. And since cryptocurrencies have been accused of amplifying risks to the financial stability of emerging markets, Government officials therefore have to implement a number of policies to manage those risks. since the complete ban to regulatory control.”
at the same time There is also a risk if central banks and regulators react in a way that He added that such policies could push crypto activities into the shadows.
The bank also cites Bitcoin exchange-traded funds (ETFs) as one of the key market risks in emerging markets. Because such products can reduce the barriers to access to investors. and may increase the risk
The authors of the report refer to a situation in which Bitcoin ETF investors “who do not own crypto assets, but still face substantial losses as Bitcoin prices plummet.” and magnify their risk if they hold too much in the futures market,” the document said.
refer : cointelegraph
picture coindesk
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