Former Bundesbank Chief: Bitcoin Doesn't Meet Full Definition of a Currency

UBS chairman Axel Weber offered a strong rebuke of cryptocurrencies during an event in Zürich earlier today.

AccessTimeIconOct 4, 2017 at 6:35 p.m. UTC
Updated Sep 13, 2021 at 7:00 a.m. UTC

The chairman of Swiss banking giant UBS doesn't believe that bitcoin meets the full definition of a currency, according to new statements.

Axel Weber, who previously served as head of the Bundesbank, Germany's central bank, made the remarks during an event in Zürich earlier today, according to Reuters.

After noting that his skepticism toward the cryptocurrency "probably comes from my background as a central banker," Weber argued that in spite of arguments to the contrary, bitcoin only partially satisfies the common definition of a currency.

He told event attendees:

"The important function of a currency is, it’s a means of payment, it has to be generally accepted, it has to be a store of value and it’s a transaction currency. Bitcoin is only a transaction currency."

Weber reportedly criticized the cryptocurrency market back in late 2015, according to a report at the time from City A.M. He is said to have remarked that the bitcoin model is set to fail "because there is no lender of last resort – there will always be boom and bust."

The UBS chairman becomes the latest figure from a major financial institution to weigh in on the topic of cryptocurrencies. Just yesterday, Lloyd Blankfein, the CEO of Wall Street investment bank Goldman Sachs, took to Twitter to offer an open (if not neutral) perspective on bitcoin.

Image Credit: International Monetary Fund/Flickr

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