Digital currencies may come and go. But the banks and regulators sweating the rise of cryptocurrencies like bitcoin should keep a close eye on the technology behind the coins, says a report from the Bank for International Settlements (BIS).
More digital currencies are circulating today than buyers know what to do with. Some 600 are out there and the plethora of formats and protocols behind them could hinder consolidation into a robust market.
“This diversity may represent a barrier to the use and acceptance of these schemes, as fragmentation in various initiatives could be an obstacle to achieving the critical mass necessary to realise the network effects that are common to all payment networks,” BIS’ Committee on Payments and Market Infrastructure pointed out in its first report on digital currencies in several years.
Bitcoin, which grabbed global attention in 2013 when its value soared beyond US$1,000, uses a public protocol called blockchain. It’s one of many technologies used to process cryptocurrencies.
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http://www.scmp.com/business/global-economy/article/1883197/pay-attention-bitcoin-technology-bank-international
