(Australian Associated Press)
The financial sector will likely adapt to and use new financial technology like Bitcoin, the Reserve Bank says.
RBA head of financial stability department Luci Ellis downplayed the risks posed by emerging financial technologies – known as “fintech” – to the established financial system.
Ms Ellis pointed out there were already some very interesting applications of Blockchain (the Bitcoin global transaction ledger) going on in the financial sector.
“There will be some disruption, but there will also be banks using tech,” she told the Sydney Banking and Financial Stability Conference on Tuesday.
“It’s hard to see it in the short to medium term as anything other than, well, you know the financial sector always innovates and there will be some interesting things, and some might pose risks, but not all of them.”
She joked that one of the issues with Blockchain was that everyone seemed to spending all their time at conferences about Blockchain.
“That might be a consumption of real resources that we might not otherwise chose,” she said.
However, Ms Ellis did point out that a problem with free, unregulated alternative fintech and financial systems was they did not offer market participants a predictable nominal value for currency.
“Neither does Bitcoin,” she said.