The rise of digital currencies could lead to a flood of withdrawals from high-street banks, risking financial stability and the wider economy, the Bank of England has warned.
Threadneedle Street said that stablecoins – a new form of digital asset usually pegged to the value of a traditional currency – would need to be regulated in the same way as payments handled by banks if they became widely available. Research shows high-street banks could face a flood of withdrawals leading to financial instability. The Bank of England has warned that large numbers of consumers moving deposits into digital assets could undermine the stability of high-street banks.
Read more at https://www.theguardian.com/business/2021/jun/07/digital-currencies-pose-threat-to-economy-warns-bank-of-england