Andrew Bailey, Governor of the Bank of England, recently appeared on the Jobs of the Future podcast to discuss the future of bitcoin and cryptocurrency where he explained he does not believe bitcoin is a practical means of payment.
When asked if the governor owns any bitcoin, he responded:
“I don’t, no. To be honest with you, I’m probably not liked by the advocates of bitcoin because I have said I don’t think it has any intrinsic value.”
The governor continued to explain that he believes bitcoin can only have extrinsic value, which just means people want to own and acquire it as a store of value. Bailey claimed the absence of intrinsic value lies in the impracticality of bitcoin as a means of payment when he was discussing what form of digital money would evolve to widespread use, if not bitcoin.
“I don’t think it will be crypto, in a sort of bitcoin sense of the term. I don’t think that’s a practical means of payment,” Bailey explained. “But again, it may well lead to things.”
However, the governor then explained that there does seem to be value in the underlying technology of bitcoin as it relates to the future of payments. Bailey explained the technology (“blockchain and distributed ledger technology”) should be respected and then continued to explain the inevitability of digital money.
“What I think is to be determined, is if we are much more likely to be living in a world of digital currency than old fashioned payment methods, precisely what form of digital currency or digital use actually winds up being the one that becomes the sort of accepted norm?” Bailey posited.
In discussing the possible outcomes of the public wanting to adopt digital forms of money, the governor touched on the responsibilities of regulators to evolve with changing tides. One of the governor’s closing thoughts on the matter of Bitcoin and its underlying technology focused on the regulatory action of entities like the Bank of England.
“We can sometimes get in the way of certain things we shouldn’t get in the way of,” said the governor.