Reserve Bank of Australia Proposes BIS to Regulate Digital Currencies

Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term will need regulation, according to a statement made by the Reserve Bank of Australia. Replying to a digital currencies enquiry made by the Senate Economics References Committee in Australia, the central bank has advocated for the Bank of International Settlements (BIS) to step in.

For the community of cryptocurrency users, this sounds as nothing but a nightmare. After digital currencies were proclaimed as an alternative to the fiat money created by global central banks, the BIS is the last institution which may appeal to a large number of digital currency users.

Known as the central bank of the central banks, the Bank of International Settlements aims to introduce more predictability and transparency into the mysterious world of central banking. It boasts 60 member central banks, and regularly issues studies on the state of the currencies and derivatives markets.

What the Reserve Bank of Australia advocates is that only an international body will have the global reach necessary for intervention in the digital currency marketplace.

Highlighting that a coordinated response might be necessary in the future, as adoption of digital currencies grows, the RBA points at the Committee on Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term and Market Infrastructure (CPMI) at the BIS.

The Australian central bank cryptocurrencies represent an “interesting development” in the payments and financial system landscape. However, it also explains that the adoption rates of cryptocurrencies is currently very low in order to justify the RBA’s involvement as a regulator, especially considering the global landscape on which digital currencies function.