Bank of Japan Chief says Scandal-Plagued Bitcoin Cannot be a Currency

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Bank of Japan Chief says Scandal-Plagued Bitcoin Cannot be a Currency
Bank of Japan Chief says Scandal-Plagued Bitcoin Cannot be a Currency

Bank of Japan Chief says Scandal-Plagued Bitcoin Cannot be a Currency

Casting his doubts on Bitcoin, the head of the Bank of Japan said that Bitcoin’s future is bleak as the scandal-plagued digital unit cannot be a currency unless it proves its reliability. The question of reliability is though not new for Bitcoin as it has been put on it over and over again, coming from the head of a central bank of a nation is definitely not a good sign.

The accusation is not new for Bitcoin as similar doubts were casted on it by Steve Forbes of The Forbes magazine wherein he wrote that the Bitcoin is not the answer to the Federal Reserve’s depredations against the dollar. Over the last couple of months, Bitcoin has seen several unprecedented and unwelcoming developments including the collapse of the biggest exchange Mt. Gox.

Earlier at the end of the year 2013, Bitcoin hit new heights when its exchange value went up to $1200 and more. However, later on the computer-generated currency suffered a series of blows since February when the Tokyo-based Bitcoin trading exchange Mt.Gox filed for bankruptcy after losing close to half a billion dollars of Bitcoin.

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Unlike Fiat, Bitcoin is not backed by a Government or Central Bank

A major concern is that unlike most of the fiat, Bitcoin is not backed by a government or central bank. In his opinion BoJ Governor Haruhiko Kuroda said that it is not a currency and he does not think it is a general means of settlement. His opinion came to surface when he was addressing the group of reporters after the central bank wrapped up its latest policy meeting.

BoJ Governor said that without safety or stability in its value, there would be no demand. In that sense, it cannot be a currency. Similar doubts were casted by Steve Forbes in his piece wherein he said that none really knows how this coin is created and there cannot be functional money without a basic transparency.

Steve Forbes cleared that unless some is addicted to volatile trading for the sake of trading, he needs to stay away from the Bitcoin. The opinion from the head of BoJ seems to a result of the recent unfortunate event that led to uncertainty not just in the exchange value of Bitcoin which fluctuates a lot but also about the security of investors’ funds.

To contact the reporter of this story: Deepak Tiwari at deepak@forexminute.com

  • fred park

    compared to the USD, Yen, Yuan, btc is the cleanest currency around.