Unbacked

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

• Altcoin
• Bitcoin
• Blockchain
• Britcoin
• Central bank digital currency (CBDC)
• Credit enhancement
• Credit support
• Crypto
• Cryptoassets
• Cryptocurrency
• Cryptography
• Debt
• Distributed ledger
• Fiat currency
• Financial stability
• Guarantee
• Intangible assets
• Internal Crypto-Assets Task Force
• Intrinsic value
• Monetary policy
• Money
• Ripple
• Security
• Speculative
• Stablecoin
• Token
• Unsecured
• Unsecured debt
• USD Coin
• Volatility