German Central Bank calls for global cryptocurrency regulation whilst adding Chinese Yuan to its currency reserves.
During the last few weeks both China and South Korea have made statements regarding regulating cryptocurrencies and although nothing definite has been announced, the rumors have caused turmoil in Bitcoin and Altcoin cryptocurrency markets.
Now the cryptocurrency regulation rumors have moved to Europe with the German Central Bank stating that cryptocurrency regulation must be on a global scale as opposed to just National or regional rules.
The global financial industry has begun to wake up to the implications of the global boom in the trading of Bitcoin and other cryptocurrencies which are attractive partly due to their ability to be used across borders. As well as the implications for tax evasion and illegal activities, Government’s and Central Banks around the world may also be concerned about the implications for existing Fiat currencies.
Joachim Wuermeling a member of the board of Germany’s Bundesbank, expressed concern that national or regional rules may struggle to contain what has become a global phenomenon.
“Effective regulation of virtual currencies would therefore only be achievable through the greatest possible international cooperation because the regulatory power of nation-states is obviously limited,” Wuermeling told an event in Frankfurt on Monday.
In a separate “unrelated” announcement today, the Bundesbank also disclosed that it will be adding the Chinese yuan to its basket of currency reserves.
“It is not a major amount but it is something that we decided on and that we want to be part of,” Dombret, who is responsible for banking supervision at the Frankfurt-based institution, said in an interview with Bloomberg Television’s Stephen Engle. “The fact that the renminbi is now included in the SDR basket and the fact that the ECB has decided to do that are both factors we thought about.”