Governor of the Central Bank of Ireland: Regulators’ concerns about cryptocurrencies are mainly due to their instability

On July 30, Gabriel Makhlouf, Governor of the Central Bank of Ireland, said in an article on the central bank’s website that distributed ledger technology has a wide range of beneficial applications and can make the financial system more efficient.

But for now, the negatives surrounding cryptocurrencies far outweigh any benefits, and as more people participate in cryptocurrency transactions, while there are still problems with lack of transparency, crime and high energy consumption, the risks posed by cryptocurrencies to financial stability and consumer protection are increasing.

One of the main concerns regulators have about cryptocurrencies is that they lack a pricing anchor to an underlying asset to keep their value stable, making them highly volatile even when compared to riskier investments like stocks.