Serious ‘Fast Evolving’ Global Crypto ‘Threat’ Warning After Huge Bitcoin And Ethereum Price Swings

Bitcoin

BTC
, ethereum and other “fast evolving” cryptocurrencies could soon become a threat to global financial stability, according to the chair of an international body tasked with shoring up the financial system.

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The bitcoin price has ballooned over the last two years, surging from around $10,000 per bitcoin to almost $70,000 late last year. Ethereum, the second-largest cryptocurrency, has likewise rocketed higher—boosted by the surging popularity of so-called decentralized finance (DeFi), a blockchain-based alternative financial system.

The price of both bitcoin and ethereum have since crashed back, losing around 40%, and dragging down the wider crypto market that’s lost more than $1 trillion in value in less than six months as investors balk at the prospect of rapidly rising interest rates and an end to pandemic-era stimulus measures.

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“Crypto-asset markets are fast evolving and could reach a point where they represent a threat to global financial stability due to their scale, structural vulnerabilities and increasing interconnectedness with the traditional financial system,” Klaas Knot, a Dutch central banker and the chair of the Financial Stability Board, wrote in an open letter this week, warning the finance ministers of the Group of 20 top economic powers that global…