Unbacked
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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
