Crypto Needs to Be Separated from the Real Economy
Regulators are worried about a selloff in digital currencies infecting mainstream markets.
Shiny. But dangerous.
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Last week, the European Central Bank laid out the nightmare scenario that’s got financial regulators nervously watching developments (i.e. collapsing prices) in the world of digital currencies: “Although the risks are currently small, they could rise significantly if platforms started to offer services to the real economy, instead of remaining confined to the crypto universe.” Overseers are worried that a selloff in the virtual space could infect mainstream markets in an echo of how the unraveling of the US subprime mortgage market triggered the global financial crisis more than a decade ago.