Bitcoin is bad for the planet, according to BIS

Concerned about the environment? Well, then you should be concerned about Bitcoin. That’s the banking institute, the Bank for International Settlements, which recently called Bitcoin a “low-value, high-risk” financial instrument, and an “environmental disaster.”

The Bank for International Settlements (BIS) is an international organization of central banks. Their purpose is to provide a forum where central banks can discuss issues related to international finance and economy, and also to promote cooperation amongst central banks. Recently, BIS released a report that claims that Bitcoin and other cryptocurrencies are bad for the planet, because they are not backed by a tangible commodity that is recyclable and reusable, and that they are an inefficient means of transferring value.

Bitcoin is a powerful new technology, but it also has significant environmental implications. Bitcoin mining has a huge carbon footprint, and its energy consumption has an estimated negative impact on the environment, according to a report released by the Bank for International Settlements (BIS). The report says bitcoin represents “a small but growing share of the total currency in circulation, and the pace of its growth shows no sign of abating”.. Read more about is cryptocurrency legal and let us know what you think.

Summary of the situation

  • The International Payments Bank talks about Bitcoin in its annual financial report.
  • Central banks can create their own tokens, but remain connected to the decentralized market.

Cryptocurrencies like bitcoin have gone from an unknown virtual currency in 2008 to one of the most talked about in 2021. Bitcoin has gained popularity around the world, but not all central authorities support it.

The Bank for International Settlements believes that bitcoin is a speculative asset that consumes a lot of energy and is used for fraud. The Central Authority claims that these tokens are used for money laundering and virtual fraud. BIS also argues in its annual economic report that BTC does little to promote the general interest.

The BIS is an international organisation that works together with the central banks of various countries. The purpose of the BIS is to support financial cooperation in the world so that the economy can be stable.

BIS mentions bitcoin in its annual financial report

Each year the Bank for International Settlements draws up a financial report with the central banks of the region concerned. In 2021, the organization talked about cryptocurrencies, especially bitcoin, because of the prominence they have gained. The BIS states that cryptocurrencies are speculative and not real money like the dollar, the euro, etc.

According to the BIS, cryptocurrencies have facilitated ransomware attacks, money laundering and other crimes in the past. For example, he recalls a cyber attack that hit a gas company in South Texas.

In a follow-up to the report, the BIS said bitcoin has left an indelible impression on energy consumption. According to researchers at Cambridge University, the BTC network consumes as much energy as the Netherlands. The damage done by mining cryptocurrencies can be significant, but is not fatal to the environment.

Crypto-currency regulator

Besides the Bank for International Settlements, cryptocurrencies are surrounded by regulators almost everywhere in the world. Many of these organizations argue that bitcoin is highly volatile and therefore they want to ban trading in it. In early June, banking regulator BPI unveiled strict rules for banks using cryptocurrencies.

The BIS has also analysed the use of digital currencies by central banks and labelled them as stable currencies. However, the BIS says this does not change the rules of the market as they are still virtual currencies. Indeed, any stable token like USDT is backed by the crypto currency market.

The announcement of the Bank for International Settlements coincides with that of the relevant central bank. The battle against cryptocurrencies continues and may affect the scalability of the market. The value of BTC continues to fluctuate between $30,000 and $40,000 in the regulatory landscape.

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