SEOUL, Feb. 23 (Yonhap) — Cryptocurrencies resembling Bitcoin don’t have any intrinsic worth and their worth swings are anticipated to expertise higher volatility, the pinnacle of the Financial institution of Korea (BOK) stated Tuesday.
“There isn’t any intrinsic worth in crypto belongings,” BOK Gov. Lee Ju-yeol informed lawmakers.
Requested by a lawmaker about whether or not a latest surge within the worth of Bitcoin is non permanent, Lee replied, “It is rather tough to foretell the worth, however its worth will likely be extraordinarily unstable.”
A latest rally in Bitcoin could also be a results of a number of elements, together with mass purchases by Elon Musk’s Tesla Inc. and plans by institutional buyers to make use of the digital token as a hedge, Lee stated.
The worth of Bitcoin, the world’s largest cryptocurrency, surpassed US$50,000 this month. In South Korea, Bitcoin exceeded 65 million gained ($58,479).
Some buyers say Bitcoin may very well be an alternate as a hedge to the gold, however critics say the cryptocurrency frenzy is a bubble created by extra liquidity amid the pandemic.
Lee additionally reiterated that it isn’t fascinating for the BOK to straight purchase bonds issued by the Korean authorities.
In that case, it’ll improve worries about fiscal soundness and undermine the belief of the central financial institution, Lee stated.