Cryptocurrency will not replace national Romanian Central bank

Cryptocurrencies will never be able to substitute the currency issued by a central bank said Daniel Daianu, a member of the Romanian National Bank (BNR)’s Administration Council, during a conference on Tuesday. Being bullish in the matter of opposing the cryptocurrencies he further said that Central banks may issue their own digital currencies but they will be only seen as financial assets and nothing else.

Daniel Daianu isn’t the only central bank official who has previously opposed or discouraged the blockchain and cryptocurrency adoption. Agustin Carstens, general manager at the Bank for International Settlements has also labeled the Bitcoin as Ponzi scheme and environmental disaster. However, Daniel didn’t go that far but it can’t be ignored that the central bankers are losing their guard and being bullish in holding onto their jobs.

During the conference, Daniel stated that “We must be aware of the difference between institutions and the roles they have. It is important for these roles not to disappear. Of course, technologies ensure business models and they have always done so. The segmentation of markets has been done for decades, and fintech helps business.”

Expressing his opinion and distinguishing between the cryptocurrency and fiat money, he further said that cryptocurrencies are financial assets and nothing else and they won’t be able to replace the important role that central banks and fiat money plays. central banks will always have a role to play in society, Daniel Argued. He went on further defending the state’s role as only possible last-resort lender in issuing currency and stated that “Cryptocurrencies will never be able to substitute the currency issued by a central bank. What can happen is for central banks to have a digital currency, but that will also be issued by the bank, and commercial banks will receive digital currency that can multiply.” According to him during the financial crisis, only the state-run central banks can become the life-saver, not the cryptocurrencies.

BNR official even expressed his thoughts on the Romanian capital market and said that the Romanian market is sluggish and weak in terms of listed companies and the number of transactions. He said: “We have a weak capital market, not just due to the transaction volume, but also in terms of the number of listed companies.”

Comparing the financial market of European countries including the UK and US with Romania he said that 80 percent of transactions with derivatives go through the London market. Talking about the benefits of the capital markets including stock market he stated these markets are the key pillars of the economy and plays a significant role in the growth of the companies. “I think that the Financial Supervision Authority must continue to fight for the development of the local capital market” he concluded.