UK Banks: Bitcoin Can Fund Terrorists, Destabilize Sterling

The British Bankers Association (BBA) has warned about Bitcoin’s anonymity and its potential effects on the UK financial system. In

The British Bankers Association (BBA) has warned about Bitcoin’s anonymity and its potential effects on the UK financial system.

In a joint submission with the Payments Council to the Treasury’s consultation on the benefits and threats of digital currencies, the BBA voiced concern over how such currencies can be used anonymously. As banks, they are “unclear on their responsibilities with regards to servicing those working with, paying or receiving digital currencies.”

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Their comments echo a sentiment held in other countries, where risk averse institutions have occasionally shut down the accounts of both Bitcoin businesses as well as users.

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The Treasury launched the consultation in early November to gather views on digital currency to help shape future regulation.

The submission also noted that should “convertible” currencies reach mass adoption in the UK, they can potentially destabilize the sterling. A number of governments, including that of Switzerland, have previously assessed that Bitcoin and other virtual currencies are highly unlikely to impact their currencies.

The banks’ sentiment contrasts with that of Finance Minister George Osborne who, last August, expressed cautious support for Bitcoin during remarks on strengthening London’s position in financial innovation.

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