MAS head hopes virtual coin tech will survive ‘crash’

SINGAPORE: Singapore’s central bank head said yesterday he hoped the technologies underpinning cryptocurrencies such as blockchain would not be undermined by an eventual crash in the virtual coins.

The city-state is among many global central banks voicing concern about potential losses for citizens and money laundering through cryptocurrencies.

But it is carrying out extensive research into the distributed ledger technology that underlies bitcoin.

“I do hope when the fever has gone away, when the crash has happened, it will not undermine the much deeper, and more meaningful technology associated with digital currencies and blockchain,” Ravi Menon, the managing director of the Monetary Authority of Singapore (MAS), said at a UBS Wealth Insights event in Singapore.

Menon added that he would not rule out the possibility of the MAS issuing a cryptocurrency directly to the public but that he was not sure it was a good idea.

South Korea, a crucial source of global demand for cryptocurrencies, said last week it plans to ban cryptocurrency trading, a move that sent bitcoin and other virtual coin prices plummeting.

The value of bitcoin surged around 1,500% last year to peak at nearly US$20,000 (RM79,400) in December.

However, it has broadly fallen since then and yesterday was trading around US$13,572 on Luxembourg-based Bitstamp.

On a question of whether central banks should launch cryptocurrencies to sell directly to the public, Menon said that while he could not rule it out in Singapore, he was not sure it would be a good idea.

In one of the only examples of a country planning to launch a cryptocurrency, crisis-hit Venezuela plans a virtual token backed by oil as a way to try to raise hard currency and to evade financial sanctions imposed by Washington. – Reuters