Andrew Bailey, Governor of the Bank of England, has raised concerns that crypto presents opportunities for scammers and criminals, per Bloomberg.
“You only have to ask the question: what do people committing ransom attacks usually demand payment in? The answer is crypto,” Bailey said at a “Stop Scams” conference organized by the Bank of England.
He added that while cryptocurrencies are innovative in the wider world of financial services, they also create “opportunity for the downright criminal.”
This is not the first time Bailey has warned against the risks presented by cryptocurrencies, either.
Crypto, Bailey, and the Bank of England
In November 2021, Bailey took aim at one of the biggest Bitcoin stories of the year—El Salvador’s adoption of the leading cryptocurrency.
“It concerns me that a country would choose Bitcoin as its national currency,” the Governor said. “What would worry most of all is, do the citizens of El Salvador understand the nature and volatility of the currency they have?”
One month later, the Bank of England’s deputy governor Jon Cunliffe said the crypto industry could threaten the financial system as it exists today.
“The point, I think, at which one worries is when it becomes integrated into the financial system when a big price correction could really affect other markets and affect established financial market players,” Cunliffe said.
But now, Bailey is going a step further, questioning not only the stability risks inherent in crypto but the potential role of cryptocurrencies in facilitating sanctions evasion. In fact, ransom attacks—which Bailey explicitly referenced—have netted Russia-affiliated actors millions of dollars before.
“Some crypto enthusiasts say they shouldn’t be covered by Russian sanctions because that’s not their world. I’m sorry, it is your world. We’re all in the same world,” he added.