Danske Bank (CSE: DANSKE) has reiterated its cautious stance on cryptocurrencies in a statement published on its site, maintaining its ban on cryptocurrency trading on its own trading platforms. myself.
Danske Bank keeps a cautious stance on Bitcoin and other cryptocurrencies
Denmark’s biggest bank notes growing interest in cryptocurrencies, for example Bitcoin and Ethereum, also states it frequently receives inquiries from clients, journalists and journalists different in their standing
The four chief reasons given by the lender for keeping a careful approach to cryptocurrencies are:
- Cryptocurrency transactions aren’t always transparent enough, which may make it hard for us as a bank to satisfy our duties against financial crime and money laundering.
- Cryptocurrency trading is only partly regulated by consumer and financial regulation and therefore doesn’t always provide consumer protection in relation to regulated financial products.
- Cryptocurrency valuations are opaque and extremely volatile, as well as an investor, you have very little insight into how markets evolve and what pushes costs.
- Transactions with specific cryptocurrencies need substantial amounts of computing power that’s extremely energy intensive, and this isn’t in accordance with Danske Bank’s ambitions to encourage sustainable development alongside clients. our goods.
There are also many reasons linked to the bank’s cautious stance on cryptocurrencies in addition to keeping the Bitcoin ban in Denmark such as:
Environmental Impact: Tesla (NASDAQ:TSLA) CEO Elon Musk declared his car business will stop accepting Bitcoin as payment for its vehicles on account of the environmental effect of mining and trading.
Money Laundering: Danske Bank’s entry that cryptocurrencies can make it hard to meet obligations related to money laundering might be viewed as ironic to a. The company remains under investigation in the EU and US for their role in a multi-billion dollar money laundering operation.
In April of the year , their CEO, Chris Vogelzang, was forced to resign after being named a defendant in a different case at Dutch lender ABN Amro.
However, this might be part of the reason the bank is being too cautious, given the growing use of cryptocurrencies to ease financial crime. This has been emphasized recently by ransomware strikes on US infrastructure — like the Colonial pipeline and JBS meat plants — which have seen hackers pay millions of dollars in Bitcoin to permit normal operation.
Danske Bank keeps a cautious stance on Bitcoin and other cryptocurrencies but doesn’t turn off from blockchain technology
Despite the warning, Danske Bank hasn’t completely turned its back on the technology that underpins cryptocurrencies.
“Cryptocurrencies represent a significant digital innovation in financial services, and we recognize that there is an important global market for cryptocurrencies and many customers find cryptocurrencies interesting. ,” stated the lender.
“At the same time, we see huge potential in blockchain technology, on which cryptocurrency is built.”
While Danske Bank is quite careful with cryptocurrencies for today, that could change in the future if regulation enhances.
“We are constantly monitoring developments in the crypto sector, and as the crypto market matures and becomes more regulated, we will review our position,” the lender said.
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