Saturday, June 22, 2024

    Reserve Bank of Australia Will not Issue its own Digital Currency

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    Cryptocurrency markets are still a problem for most regulators and governments. It is evident this new form of money becomes a very real threat to any financial institution on the market. Reserve Bank of Australia governor Philip Lowe is concerned over this speculative mania surrounding Bitcoin and other cryptocurrencies. Such comments often fall on deaf ears, though, as everyone wants to strike it rich overnight.

    Central banks all over the world would rather not see people invest in cryptocurrencies. These digital assets are too fickle and volatile. Moreover, they can’t be controlled or supported by banks and governments in an official capacity. This situation has not caused too much friction until the year 2017 came around. The soaring value of all cryptocurrencies resembles a mass hysteria attack of sorts. Everyone is speculating on cryptocurrencies, as there’s lots of money to be made. However, said money can be lost equally as quick, which is a far less favorable outcome.

    Reserve Bank of Australia Sees Little Merit in Bitcoin

    According to Reserve Bank of Australia governor Philip Lowe, these cryptocurrencies will not replace conventional money. It is highly doubtful anyone expected a different response at this time. Bitcoin has become a store of value rather than a currency these days. Its fees are too high and transaction delays are far too common. That said, the general public is still attracted to the allure of this virtual gold rush. It is a grave concern for the Reserve Bank of Australia.

    How all of this will play out in Australia, remains to be seen. The local government recently amended its taxation guidelines regarding Bitcoin. By removing the double taxation, the ecosystem has been given a second chance to thrive. This was all before the current price hype became visible, mind you. No one can stop people from buying and using cryptocurrencies. Not even the Reserve Bank of Australia can do something like that. Nor is that in their best interest whatsoever.

    Surprisingly, the Reserve Bank of Australia has no plans of issuing its own digital currency. Whereas other institutions are leaning toward this option, that’s not the case in Australia. Or at least not for now, as things are always subject to change. For now, there is no case for issuing “digital banknotes” whatsoever. An interesting future lies ahead for all cryptocurrencies, especially in Australia.

    Header image courtesy of Shutterstock

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