A group of leading European economists has debunked the notion that Bitcoin and other cryptocurrencies pose a treat to the finances of a nation in coming years.
A survey of about 50 universities cut across Europe conducted by the Center for Macroeconomics and Center for Economic Policy Research shows that majority are confident and optimistic despite the risks posed by digital currencies despite warnings by senior financiers.
Senior financiers like the JP Morgan and Goldman Sachs have sounded repeated warnings against bitcoin in past months. The Royal Bank of Scotland also calls Bitcoin a speculative bubble.
The limited supply of Bitcoin and the fact that it’s detached from the current financial system was one major reason for the comfort among economists stating that investors did not hold significant amounts of the digital currencies. The value of Bitcoin had risen over 900% in 2017, with its total value at about $300 billion compared to global shares value which stands presently at $80 trillion.
Fears have risen over the ability for banks being able to cover losses on Bitcoin trading as a group of investment banks have written a letter to US regulators that the system of regulation wasn’t well prepared.
Wouter den Haan of the London School of Economics pointed out that past experiences show just a critical financial institution taking a risky position puts the system at risk.
Though it’s believed that there are no risks to financial stability, it was said that the government should introduce better controls over cryptocurrencies and anonymity issues as it could enable people evading tax and also aid other criminal activities.
The survey findings come as a South Korean Cryptocurrency Exchange is appears to file for bankruptcy as the exchange was hacked for the second time this year, to make known the concerns about security as bitcoin and other alternative cryptocurrencies trade booms.
YouBit, which happens to be a South Korean Cryptocurrency Exchange had their security infiltrated in April with them loosing over 4,000 Bitcoins to hackers in that particular cyber-attack which the country’s investigation agency had linked to North Korea as allegedly reported in a recent statement by South Korean newspapers. Important: Not to confuse it with Yobit.net
YouBit made it known on its official website that it had been hacked at about 4.35am local time, with them loosing about 17% of their total assets. Though the actual figures weren’t mentioned, customers’ assets would be marked down to 75% of their value they said. They also announced that they had stopped trading and would for the meantime work on minimizing customer losses in future.
Bitcoin Exchanges and wallets are currently targets of cybercriminals, and experts say there will be more of such attempts in future as the value of bitcoin keeps rising.