Tony Richards, the outgoing Head of Payments Policy at the Reserve Bank of Australia (RBA) has weighed in on the growing crypto industry, and the increasing adoption and ownership of these asset classes by both retail and institutional investors. In a speech addressed to the Australian Corporate Treasury Association, Richards said he doubts the legitimacy of the statistics that showcase the percentage of Australians that hold digital assets.
The RBA Executive particularly specifically faulted the surveys that asserted that as many as 20% of Australians hold cryptocurrencies, with about 5% personally invested in Dogecoin. He said the false claims are representative of the misleading information that is influencing the hype the industry is currently built upon.
I must say that I find these statistics somewhat implausible. I cannot help thinking that the online surveys they are based on might be unrepresentative of the population,” he said in the speech, adding that “while it is hard to point to any firmer evidence on cryptocurrency holdings by Australians, some of the estimates out there are extremely surprising and may be symptomatic of the significant amount of hype and misinformation in this area.”
While Tony Richards acknowledges the maturity and growth of the market to the point that the market capitalization now tops $2.6 trillion, he is particularly doubtful the bullish trend can be sustained for much longer. In his speech, he highlighted three major factors that will likely stump the growth of these nascent asset classes in the near future.
First, he believes the challenges of regulation will soon catch up with the industry, as retail holders may weigh in on the caution of market watchdogs like never before.
“Households might be less influenced by fads and a fear of missing out and might start to pay more attention to the warnings of securities regulators and consumer protection agencies in many countries about the risks of investing in something with no issuer, no backing, and highly uncertain value,” he said.
He also believes the crackdown on energy-intensive Proof-of-Work (PoW) protocols such as China did with Bitcoin may stir a disinterest amongst investors. Lastly, he believes the imposition of new tax regimes by governments around the world may also limit the scope of investments and use of these crypto-assets.
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