The president of Peru’s central bank considers cryptocurrencies to be the least environmentally friendly thing there is. He also reiterated that Peru is working on its own digital currency.
The president of the Central Reserve Bank of Peru (BCR), Julio Velarde, talked about cryptocurrencies in an interview. His opinions are still quite reluctant to them. Among other things, he warned that cryptocurrencies are a danger to the environment because of the high pollution generated by their use.
“The problem with cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. now is climate change. It’s the least environmentally friendly. To keep mining a process where blocks are added to a blockchain, verifying transactions. It is also the process through which new bitcoin or some altcoins are created. bitcoins consumes the energy of a medium-sized country. It’s staggering amounts.” the head of the BCR in a lengthy dialogue with INFOX. Here you can see the video:
Cripto no es medio de pago
Likewise, Velarde indicated that the BCR’s position is not to consider cryptocurrencies as a payment, but as a financial asset. In this regard, he said:
“We don’t consider it a means of payment, but a highly volatile financial asset and if people buy it, it’s because of its risk.”
Even the validation of transactions seems to him to be ineffective, as it “is quite time-consuming and resource-consuming”.
Likewise, he insisted that in his opinion cryptocurrencies “they have no intrinsic value. At some point people may lose interest in having it, and then the price can drop to anything.
Criticism of NFT non-fungible tokens (NFTs) are cryptocurrencies that do not possess the property of fungibility.
Velarde also referred critically to non fungible in cryptocurrency, fungibility is when a coin or token can be replaced by any other identical coin or token. tokens (NFTs).
“They say that the art market, 10% is made with cryptocurrencies, I doubt that; unless it’s these things they are starting to sell: which is this figure, a digital digital technologies are these electronic tools that have the ability to generate, store or even process data. painting, which they claim only has one owner. I don’t know how much that will grow or how important that is, the figure they presented seemed a bit a bit is a basic unit of information in computing. exaggerated to me.” .
And he stressed:
“The problem is that there is so much liquidity how easily a cryptocurrency can be bought and sold without impacting the overall market price. in the world that there is a desperation to look for any asset. These digital artworks, even though most of them don’t have that much merit and some probably do, are selling for US$40,000 or US$50,000″. .
He further argues that, unlike physical works are exclusive and valuable, in his view these virtual objects are not so exclusive and valuable:
“These are not the Fabergé eggs that the Russian emperor had, which is a limited quantity and they are beautiful. There’s not much behind them.
¿Fintech o Techfin?
The bank’s authority indicated that central banks are not worried about the fintech (startups financial services), but rather the techfin i.e. technology giants, such as Amazon o Alibaba, who have entered the world of finance.
“These technology platforms are going to become more important. Particularly the tech giants. When you talk to the biggest banks in the world, they’re not so much concerned about fintech, they’re concerned about big tech companies, like Amazon, Apple, etc., starting to produce their currencies.” he stressed.
En el mercado estadounidense, agregó, hace 10 años, menos del 30% de créditos de consumo provenían de estas plataformas, y now exceed 50%. . As for mortgage loans, prior to the financial crisis, 30% of these were held by technology platforms; now it adds up to 60%.
“This discussion of what the banking, financial map is going to be is probably going to be quite different in 10 years, in payments, credit and everything.” .
Digital currency currency is a medium of exchange that defines value. of Peru
The bank’s president also confirmed that they are working on a draft to trace the path of a digital currency in Peru. Information about the Central Bank Digital Currency in that South American country had already been advanced in November 2021.
Now, Velarde specified:
“The white paper we’re finishing in probably a month or a month and a half to map out the route, which we’ll have to correct permanently.” .
He added that they have a strong team that is in charge of working on this proposal and will also hold meetings with executives from India and the International Monetary Fund (IMF) to get more light on this issue.
“On Tuesday I will have a virtual meeting with a team from the IMF, with whom I have been working for several months, looking at the current payment market an area or arena, online or offline, in which commercial dealings are conducted. conditions in Peru to be working on the roadmap a roadmap is a high-level visual summary that helps map out the vision as well as the direction of a specific product. that we have to do.” he said.
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