UBS Chief Joins the Bankers’ Bitcoin Bashing Brigade

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The chairman of UBS has claimed that, according to him, bitcoin does not fulfill the functions of a currency.

UBS Chairman and former Bundesbank (Germany’s central bank) president Axel Weber was speaking at a financial conference in Zurich this week when he played down the potential of bitcoin, a decentralized cryptocurrency completely independent of a central authority.

In statements reported by Reuters, the senior banker claimed his skepticism of bitcoin “probably comes from my background as a central banker.”

He went on to explain:

The most important function of a currency is, it’s a means of payment, it has to be generally accepted, it has to be a store of value and it’s a transaction currency. Bitcoin is only a transaction currency.

Weber has previously claimed that private currencies like bitcoin will “always be boom and bust…because there is no lender of last resort,” according to a City A.M report in November 2015. The ‘lender of last resort’ is a role typically taken by a central bank where the entity has the authority to change the supply of money during a financial crisis.

Weber’s comments about bitcoin come in the weeks following the much-publicized comments by JP Morgan CEO Jamie Dimon who called bitcoin “a fraud” that is “worth nothing”. Other major Wall Street figures, such as Goldman Sachs CEO Llyod Blankfein revealed a more neutral take on bitcoin in a public social media post this week.

Conversely, Morgan Stanley CEO James Gorman recently called bitcoin “a fascinating development that’s certainly something more than just a fad.”

Featured image from Flickr/INSM.

Last modified: May 21, 2020 9:12 AM UTC

Samburaj Das @sambdas

Samburaj is the Chief Editor of CCN.com, one of the earliest and foremost publications covering blockchain, cryptocurrency, and financial technology news. He has authored over 2,000 articles for CCN.com. Reach him at samburaj@ccn.com. Visit his LinkedIn profile here or his Muck Rack profile here.