Unbacked: Difference between revisions

From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson
(Expand definition.)
imported>Doug Williamson
(Expand definition.)
Line 1: Line 1:
''Cryptoassets - debt.''
''Cryptoassets - debt.''


An unbacked asset or debt is one that does not have any additional security, support or other backing for its value.
An unbacked asset - for example a debt receivable - is one that does not have any additional security, support or other backing for its value.




Revision as of 21:45, 10 November 2021

Cryptoassets - debt.

An unbacked asset - for example a debt receivable - is one that does not have any additional security, support or other backing for its value.


Unbacked cryptoassets
"Unbacked cryptoassets make up nearly 95% of the [total]... Bitcoin, of course, is the most prominent example, but there are now nearly eight thousand unbacked cryptoassets in existence.
These have no intrinsic value – that is to say there are no assets or commodities behind them: the value of the cryptoasset is determined solely by the price a buyer is prepared to pay at any given moment.
As a result, their value is highly volatile... For this reason, the main use of unbacked cryptoassets is for speculative investment..."
Is 'crypto' a financial stability risk? - Bank of England - Jon Cunliffe, Deputy Governor, Financial Stability - October 2021.


See also

Retrieved from ‘https://wiki-dev.treasurers.org/w/index.php?title=Unbacked&oldid=49402’