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Bitcoin, the world’s leading cryptocurrency, ended 2015 as the year’s best-performing currency. Achieving this recognition has not always been plain sailing, however. Its association with crime – namely money laundering and narcotics through the online black market Silk Road – as well as an alarming amount of price volatility has left regulators and financial-market participants wary of its potential implications, and therefore reluctant to embrace it wholesale thus far. Recent attention, moreover, has been focused more towards bitcoin’s underlying payment system than on the value of the currency itself. The technology underpinning bitcoin operates using a decentralized payment system, which means that a payment between two parties is direct and relies on reliable copies of the ledger being distributed to a vast network of bitcoin users around the world, who can verify any changes which makes the ledger considerably more secure – and less subject to nefarious manipulation, which relies on the trust of one central entity. As digital currencies emerge, therefore, the preference for decentralised payment systems would ostensibly render the banking intermediary redundant, which raises pertinent questions regarding the role – or lack thereof – of central banks. It should be stressed that the overall value of bitcoins is negligible in comparison to the value of notes and coins, and therefore is unlikely to make noticeable dents in any financial system. However, the potential impact of the digital currency is not being taken lightly. It could disrupt the ability of central banks to exert control over the economy, as well as to issue money, although such concern was explicitly based on the assumption that “widespread adoption” would reduce the functions of a central body. At this stage, most central banks are closely noting developments in the growth of bitcoin and proposing the issuance of a digital version of their fiat currencies has been the way some of them have already responded.
From: The Impact of Bitcoin on Central Banks acesso
em 27/12/2107 https://internationalbanker.com/banking/
impact-bitcoin-central-banks/ April 11,
2016emily.frost@internationalbanker.com
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