Transcript: Money Minute: What is Cryptocurrency?
Money Minute - What is Cryptocurrency?
Luc de la Durantaye
Managing Director, Asset Allocation and Currency Management
CIBC Asset Management
“Cryptocurrencies like Bitcoin use a blockchain, which is a secure digital ledger that uses cryptography, to record and verify transactions. It’s decentralized, working on a peer-to-peer network, without a central bank, and it operates outside of government oversight. Once a transaction is recorded, it’s nearly impossible to delete or change it.
It’s difficult to measure cryptocurrencies as a way to store a value. That’s because they have a short history and tend to experience volatile corrections. As a way to exchange value, this volatility also poses risks, since the value can be highly unpredictable.
And so, at the moment, cryptocurrencies are probably best considered a speculative phenomenon. However, the launch of investment vehicles, that allow banks to bet on the price of cryptocurrencies like Bitcoin, without actually holding it, may help bring this disruptive technology into the mainstream.
For the moment, we’re keeping our distance, but we’re also keeping an open mind.”
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