A senior Taiwanese official urged the government to develop measures aimed at addressing the potential impact of cryptocurrencies on the financial stability of the state in the event of a crash.
Speaking at a seminar organized by 2 Feb by Taiwan Academy of banking and Finance, Shih Jun-JI (Shih Jun-ji), Vice President of administration of Taiwan, considered the issues related to financial implications of the influence of cryptocurrency and relevant normative acts.
According to a government report, Shea said that with the rapid development of crypto-currencies in recent years, Taiwan should actively participate in the creation of policies aimed at curbing the growing influence of technology on Finance. In addition, the country must have the capacity to maintain its financial stability in the event of a market crash, he said.
The official explained that the market capitalization of bitcoin is about $ 170 billion, at the time trading at $ 10 000 per coin, equals one-third of the foreign exchange reserves of Taiwan, two state financial budgets or the total number of assets of all banks in Taiwan.
While the rising price of bitcoin has led to the proliferation of the opinion that this is a bubble, Shea said that the price hike doesn’t necessarily tell about it. However, he came to the conclusion that the government should start studying preparation for the elimination of the consequences in the event of a sharp fall in prices of cryptocurrencies.
Shi was previously the Chairman of Taiwan Committee on financial supervision from 2016 to 2017.