Bank of Spain warns about the use of crypto
Bank of Spain warns about the use of crypto
Crypto

Bank of Spain warns about the use of crypto

By Vincenzo Cacioppoli - 27 Apr 2022

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The Bank of Spain has just published a new report on the popularity of the use of crypto and the possible effects it could have on the nation’s financial stability.

Bank of Spain report, warning about crypto

bank of spain bitcoin btc
The Bank of Spain warns the nation about the use of crypto, which could undermine the country’s financial stability

A recent report from the Central Bank of Spain, an institution led by Pablo Hernandez da Cos, warns Spanish people of the risks associated with the use of cryptocurrencies, which are becoming increasingly popular in the Iberian country. 

The report is the result of a detailed three-month study conducted by the Bank’s experts to understand what impact a sustained adoption of cryptocurrencies would have on the country’s financial stability. 

Already at the end of February, Governor Hernandez da Cos had stated that the financial mix between traditional services and digital assets was very risky

Considering these potential risks, the governor said that public authorities should be obliged to intensify monitoring, regulation and supervision of the cryptocurrency market

In addition, all financial institutions offering crypto services should provide warnings about the associated risks with the utmost diligence.  

According to the newly published report:

“This work, in order to be effective and efficient, must be carried out with close cooperation, both international and inter-institutional, so as to avoid issues”.

The cryptocurrency market is considered to be still very limited, but its exponential growth could pose a systemic risk to the global economy.

The report concludes with an analysis of the relentless growth of stablecoins that could pose a serious risk due to their lack of transparency regarding cash reserves

Crypto regulation according to Panama

Meanwhile, in Panama, a bill on cryptocurrencies, presented by MP Gabriel Silva in September 2021, is currently being debated at second reading in the National Assembly, with the aim of finding a first clear regulation for the sector.

The proposal, approved in the first round of debate, is now facing a second examination based on some changes made to the original text. 

One of these changes would be linked to the need to incorporate more digitization into the state machine and its offices precisely through the use of blockchain technology: 

“Expand the digitalization of the State by promoting the use of distributed ledger technology and blockchain in the digitalization of the identity of natural and legal persons in or from the Republic of Panama and as a means to make the public function transparent”.

Crypto and the Brazilian Parliament

Yesterday, the Brazilian Parliament finally approved, at least in the Senate, its bill to regulate the crypto sector. Now the bill will have to pass the House and if approved (certainly by the end of 2022) after President Jair Bolsonaro signs it, it will become law. 

The decision was greeted with great enthusiasm by its proposer, MP Aureo Ribeiro.

Ribeiro had first submitted the text to parliament back in 2015, commenting then:

“I want to congratulate the author of the draft, Senator Irajá, on the approval, here in the plenary of the Senate, of this important bill”.

The MP also wished to comment on the historic decision of the Brazilian Senate with a tweet rewarding his long effort to reach this milestone.

Among other things, the bill provides for easier access for those wishing to install mining farms on Brazilian soil, with the proposal to offer a total tax exemption for interested companies. 

In addition, the bill provides for stricter regulation to combat fraud and criminals who exploit cryptocurrency technology. 

 

Vincenzo Cacioppoli

Vincenzo was born in Genova but lived most of his life in Milan. He has a degree in political science. He is a journalist, blogger, writer, and marketing and digital advertising expert. After a long experience in traditional marketing, he started working with the web and digital advertising in 2011, creating a company called Le enfants. Passionate about the web and innovation, in 2018 he started exploring the topics related to blockchain technology and cryptocurrencies. Independent cryptocurrency trader since March 2018, he now collaborates with companies in the sector as a content marketing specialist. In his blog. mediateccando.blogspot.com, he has long been primarily focused on blockchain, which he considers to be the greatest technological innovation after the Internet. His first book about blockchain and fintech is scheduled for release in November.

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