BoE: Crypto growth could create risk

Cryptocurrency market is double the size of the sub-prime debt in the U.S. on the eve of the financial crisis posing a threat unless urgently regulated according to the Bank of England.

Crypto assets are worth $2.3 trillion, about 200% more than at the start of 2021. While that represents a small segment of the $250 trillion global financial system, it is twice as much as the size of the $1.2 trillion sub-prime real estate debt market in 2008.

“You don’t have to account for a large proportion of the financial sector to trigger financial stability problems,” BOE Deputy Governor Jon Cunliffe said in a speech on Wednesday.

Cunliffe warned that when something in the financial system is growing very fast, and growing in largely unregulated space, financial stability authorities have to sit up and take notice.