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Bank for International Settlements (BIS) official and former European Central Bank (ECB) executive board member Benoit Coeure insists that bitcoin has failed the test to be a means of payment. He calls El Salvador’s decision to make cryptocurrency legal tender “an interesting experiment.”
BIS official doubts Bitcoin could work as a payment method in El Salvador
Benoit Coeure, head of the innovation hub of the Bank for International Settlements (BIS), commented Friday on El Salvador’s decision to make bitcoin legal tender. He said at the launch of a regulatory research hub at the Bank of England (BoE):
El Salvador is really an interesting experience.
Member of the BIS executive committee, Benoit Coeure was appointed head of the bank’s innovation division in 2020. He was previously a member of the management board of the European Central Bank (ECB). From 2013 to 2019, he chaired the BIS Payments and Market Infrastructures Commission.
El Salvador became the first country in the world to adopt bitcoin as its national currency, alongside the U.S. dollar, after its congress on Wednesday passed a bill to make cryptocurrency legal tender. The country is now exploring mining using energy from volcanoes.
Coeure underlined:
We have made it clear to the BIS that we do not consider bitcoin to have passed the test of being a means of payment. Bitcoin is a speculative asset and should be regulated as such.
The head of BIS is not the only one to have expressed concerns about bitcoin being legal tender in El Salvador. The International Monetary Fund (IMF) said Thursday that “the adoption of bitcoin as legal tender raises a number of macroeconomic, financial and legal issues.”
Meanwhile, many countries, including the United States, are stepping up their efforts to regulate cryptocurrencies. This week, financial regulators in major economies proposed additional capital rules for banks holding crypto assets.
What do you think of Benoit Coeure’s comments on bitcoin in El Salvador? Let us know in the comments section below.
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