[2017-12-17] Bitcoin Not a Threat to Financial Systems, Says US Chief Financial

[Terraformer]

The US chief financial watchdog, the Financial Stability Oversight Board (FSOC), claims that Bitcoin and other cryptocurrencies do not pose a threat to existing financial systems around the world. In its 152-page report, the FSOC stated that virtual currencies are only utilized by a very small number of consumers and their underlying Blockchain technology offers potential in various industrial applications.

“Virtual currencies are only used by a very small number of consumers. We give a bit more credit to the potentially much broader applications of the so-called distributed ledger technology underpinning the innovations. It is noteworthy that this digital wave also presents a regulatory challenge, because the storage of data is decentralized, rather than being in one spot that governments can watch.”

Other highlights of the report

The report’s view on digital currencies is somewhat surprising due to the negative stance shown by several financial industry personalities. An example is a recent claim by JPMorgan Chase CEO Jamie Dimon, that Bitcoin is a ‘fraud’ and should not be taken seriously.

The report also cited various monetary threats, geopolitical risks and cybersecurity threats that confront the global financial system. Bitcoin was not cited as a threat.

Performance of the digital currency market

The virtual currency market registered considerable growth throughout 2017. However, despite its phenomenal growth, the market’s total combined value is still significantly below $1 trillion and likely too small to be a systemic threat to the global financial sector. At the same time, the potential that could be unleashed by cryptocurrencies is extreme.

https://cointelegraph.com/news/bitcoin-not-a-threat-to-financial-systems-says-us-chief-financial-regulator

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[aso118]

I would say this is positive, since it means that the lobbying of banks who predicted doomsday scenarios has not worked. Regulation would bring in more investors and users to Bitcoin, but it is also possible that it could strangle its growth, like BitLicence did in New York. At least in the crypto world. America is not the leader in friendly regulation.

[BitHodler]

It could potentially, but there is no reason for Bitcoin to harm an economy. I am of firm believe that Bitcoin can function alongside the fiat system without any problems, where people get best of both worlds, really.

I am already at a point where I have found a perfect balance between both worlds. Bitcoin for me is a store of value which grants me the financial freedom I look for, and fiat is giving me the daily convenience that I need.

At some point Bitcoin will become so mainstream, that banks will incorporate Bitcoin into their way of doing business. It's impossible for them to keep ignoring Bitcoin that is only growing in popularity.

If the mass jumps on something, the industry will eventually adapt to it in order to not fall behind.

[Samarkand]

The US chief financial watchdog, the Financial Stability Oversight Board (FSOC), claims that Bitcoin and other cryptocurrencies do not pose a threat to existing financial systems around the world. In its 152-page report, the FSOC stated that virtual currencies are only utilized by a very small number of consumers and their underlying Blockchain technology offers potential in various industrial applications.

...

According to the Financial Stability Oversight Board (FSOC) Bitcoin doesn´t pose a threat to the existing financial system.

Also the FSOC:
Writing a 152-page report on exactly this topic.

They still don´t understand the huge ramifications of the availability of a cryptocurrency like Bitcoin. Bitcoin has 99.99 % uptime
since its launch, is transacting bigger and bigger amounts of money and mining is finally becoming more decentralized (huge
corporations are starting to get into Bitcoin mining in the US and Japan). Besides, new derivatives like Bitcoin futures are being
introduced, which will finally pave the way for Bitcoin ETFs. Bitcoin has entered the mainstream and these US authorities
are still clueless.

[kueyen]

I would say this is positive, since it means that the lobbying of banks who predicted doomsday scenarios has not worked. Regulation would bring in more investors and users to Bitcoin, but it is also possible that it could strangle its growth, like BitLicence did in New York. At least in the crypto world. America is not the leader in friendly regulation.

But is there any other way than regulation? No matter how harsh it is. Because the other alternative is that bitcoin will be outlawed, or will remain in a regulatory gray zone, in which cases the growth of bitcoin will be hampered anyway. So the worst regulation is better than no regulation in my opinion.

[Zicadis]

This is very positive news for bitcoin and other cryptocurrencies and this coming from a high profile government personnel means people have sat down to look at its pros and cons and concluded that its not a threat to Financial Systems, hope they will give it a chance by legalizing it .

I would say this is positive, since it means that the lobbying of banks who predicted doomsday scenarios has not worked. Regulation would bring in more investors and users to Bitcoin, but it is also possible that it could strangle its growth, like BitLicence did in New York. At least in the crypto world. America is not the leader in friendly regulation.

agree with you and bitcoin needs regulation right now to prove that Bitcoin is not a threat to Financial Systems

[jjacob]

Government agencies seem to be talking in two voices here. The IRS is getting records of Coinbases's customers and we all know where that could lead to. The Fin Chief seems to think it is not a threat. If Bitcoin increases by another factor of 10, all of them will be scrambling to get their act together.