A new report from the Bank for International Settlements (BIS) concludes that crypto's "structural flaws" make it "unsuitable as the basis for a monetary system."
The Annual Economic Report 2022 from the BIS, a global organization of 63 leading central banks, goes on to suggest that blockchain’s role in a future monetary system will likely take the form of central bank digital currencies (CBDCs), because “a system grounded in central bank money offers a sounder basis for innovation.”
The report points to Terra’s historic collapse last month and the current bear market as the catalyst for what analysts have labeled the start of a “crypto winter,” but says that focusing on price action alone “diverts attention away from the deeper structural flaws” in crypto that render it unfit for purpose as a monetary system.
Fragmentation flaws
The report says the crypto space has two main flaws: the need for a “nominal anchor” and “fragmentation.”
The need for a “nominal anchor” refers to...
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