Crypto Exchange Tokens Pose ‘Extreme’ Risk, BOE’s Cunliffe Says
The volatility of unbacked cryptoassets like exchange tokens makes them vulnerable to runs, exacerbating their price swings, Bank of England Deputy Governor Sir Jon Cunliffe said.
Exchange-issued crypto tokens such as bankrupt FTX Group's FTT can pose “extreme” risks when accepted by their issuers as collateral, Bank of England Deputy Governor Sir Jon Cunliffe said.“A firm accepting its own unbacked cryptoasset as collateral for loans and margin payments, as there are indications may have happened with FTX, creates…