Bank of England warns Bitcoin could quickly become completely worthless

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In a world as volatile as the one surrounding cryptocurrency, investors are expected to be ready to lose everything. As it turns out, that might just happen for Bitcoin investors as The Bank of England warns about a possible crash.

Bitcoin crash warned by Bank of England

In a recent development, Bank of England deputy governor, Sir Jon Cunliffe, warned that the popular cryptocurrency could soon become worthless. As the world’s most popular token, Bitcoin has seen value peaks of $67,00. However, the currency has recently dipped to just above $48,000.

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Cunliffe told the BBC that the extreme fluctuation of Bitcoin could leave millions with nothing. With over 2.3 million Britons having around $300 worth of cryptocurrency, a market crash could destroy millions of crypto assets.

"Their price can vary quite considerably and they could theoretically or practically drop to zero," he told the BBC. "The point, I think, at which one worries is when it becomes integrated into the financial system, when a big price correction could really affect other markets and affect established financial market players.

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Cunliffe calls for regulation

In the face of crypto’s volatile nature, Cunliffe called for regulation of the virtual currency. However, the deputy governor also explained that regulating such a vast industry will require a considerable amount of time.

"It's not there yet, but it takes time to design standards and regulations,” he said. However, “we really need to roll our sleeves up and get on with it, so that by the time this becomes a much bigger issue, we've actually got the regulatory framework to contain the risks."

Despite its scary nature, Cunliffe explained that a bitcoin crash isn't as dangerous to the UK’s economy as much as the ongoing pandemic. He said: "The UK and global economies have continued to recover from the effects of the pandemic. But uncertainty over risks to public health and the economic outlook remains.”