Yahoo Finance Cryptos Fall After BIS Report Finds Bitcoin Unscalable
Investing.com - Cryptocurrencies fell on Monday, after the Bank of International Settlements said virtual coins were not scalable and likely to suffer from distrust as they become more popular.
Bitcoin was trading at $6,435.90, falling 0.62% the Bitfinex exchange, as of 9:12 AM ET (13: 12 GMT), down 4.45% over the week.
The 24-page report from the BIS condemned Bitcoin and other digital coins for being decentralized, unstable, and consuming too much electricity. If Bitcoin were to handle the the volume of digital transactions used today, it would be overwhelmingly.
“The associated communication volumes could bring the Internet to a halt,” the report said.
The report also found that trust in the decentralized digital coins could evaporate at any time.
“Trust can evaporate at any time because of the fragility of the decentralized consensus through which transactions are recorded,” the report said.
However the Basel-Switzerland organization does think that blockchain and ledger technology that support virtual coins could be beneficial for cross-border payments and trade finance.
The BIS was the latest regulator to criticize Bitcoin and other digital coins. As the cryptocurrencies have gained in popularity, regulators around the world have struggled with how to regulate the alternative coins.
Ethereum was lower after the report, falling 0.30% to $494.66 on the Bitfinex exchange. Ripple, the third largest virtual currency, decreased 3.26% to $0.51126 while Litecoin was at $93.557, falling 1.87%.
Cryptocurrencies overall were down, with coin market cap of total market capitalization falling to $275 billion at the time of writing compared to $281 billion on Sunday.
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