SINCE the heady days of late 2017 and January of this year,crypto-currencies possess gone into retreat. Bitcoin, the best-known example, and is now worth just a third of its value at its peak (see chart).But there remain plenty of true believers in digital currencies. They point out that prices are still well above where they were in 2016. And interest from institutional investors is still strong enough for analysts to want to make sense of the crypto-phenomenon.
The latest bank to lift a shot is Barclays,which devotes a lot more of its “fairness Gilt Study 2018” to the impact of technological change on finance and the economy than it does to either equities or gilts. Its report describes crypto-technology as “a solution still seeking a problem”.
It identifies four challenges in specific. The first is trust. In most countries, consumers and businesses possess faith in the currencies issued by the government. The second is sovereignty: the potential for tax avoidance and loss of financial control means that neither governments nor central banks will be keen to see private crypto-currencies lift off.
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Source: economist.com