Bitcoin not yet Proven as Credible Currency – Japan’s Finance Minister

Japanese finance minister, Taro Aso, said on Tuesday that bitcoin has not been proven to be a credible currency and that he would watch its developments in the near-term.
He made the remark to reporters when asked about his French counterpart’s comment this week that France would propose a discussion on regulating the virtual currency at a meeting of G20 group of major economies next year.
“There’s no fixed definition on whether it’s a currency or not. This issue is a difficult one,” Aso said after a Cabinet meeting.
“It has not yet been proven to be credible enough to become a currency, so I need to watch for a little while more.”
He added that virtual currencies may be widely used in countries such as China but that they were less common in Japan, where hard currency is still preferred.
Bitcoin’s prices have risen more than 1 700% since the start of the year, triggering worries about a bubble.
Meanwhile, Danish central bank governor, Lars Rohde, this week also issued a warning to potential investors in bitcoin saying they should steer clear of a dangerous gamble and not complain to financial regulators if things do go wrong.
“You should stay away (from bitcoin). It is deadly,” Rohde said in an interview with state broadcaster DR, published online on Monday.
The comments echoed concerns of a bubble about to burst made by other market participants and central bankers due to the price of bitcoin rocketing since the start of the year.
Rohde said that if people decide to ignore his warnings, they should realise that they are pretty much on their own.
“It is not a regulated market. It is not the responsibility of the authorities. It is the responsibility of the individual,” said Rohde.
Emphasizing his point, Rohde told investors not to “come and complain to us if it goes wrong”.
The launch of futures trading in bitcoin has further fuelled debate about the place of the cryptocurrency in the financial system. Decentralised digital currencies like bitcoin are still not widely accepted, and critics say that the fact that they are unregulated makes them risky to use.
European Union states and legislators last week agreed to stricter rules to prevent money laundering and terrorism financing on exchange platforms for bitcoin and other virtual currencies.
“I see bitcoin as tulipmania, which is a bubble that is out of control,” Rohde said, referring to a notorious 17th century Dutch boom and bust.
Last week, the Danish central bank said that introducing a digital version of the Danish crown currency would pose risks to financial stability without improving payment solutions for Danes.
Reuters

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