During a Senate Economics References Committee Inquiry into digital currencies, the Australian Central Bank (Reserve Bank of Australia or RBA) has suggested that the Bank for International Settlements based in Basle, Switzerland could serve as a regulatory body in the digital currency marketplace.
While the Reserve Bank of Australia believes that digital currencies represent an interesting development in the payments and financial system landscape, the RBA says that limited use of digital currencies in Australia to date, means that regulation is not yet required but with the international nature of the digital currency systems like Bitcoin, the RBA believes that the best course of action is not unilateral intervention but a coordinated response among Central Banks.
As a result, the RBA concludes that the most effective regulatory method may be to involve the Committee on Payments and Market Infrastructure (CPMI) at the Bank for International Settlements. Importantly the RBA warns against heavy-handed policing and through the use of the Bank for International Settlements, a coordinated approach from Central Banks around the world could help ensure that Bitcoin and other digital currencies are allowed to grow in a controlled environment.
Overview by Tristan Hugo-Webb, Associate Director, Global Payments Advisory Service for Mercator Advisory Group
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