Risks of cryptocurrencies --- Not being an expert in cryptocurrencies, I would say that the main risk is that they are not fiat currencies in the financial and economic strict sense. Their value comes from their scarcity and supply/demand relation, but not because they are backed by public institutions like central banks, which in turn are backed by the macroeconomic data of countries and the international trust of the financial markets. In principle, crypto currencies could be used as paper money by governments or as a kind of gold standard in the old good times before Keynes, but experiments like those in Venezuela are lacking on trust, not only because there is not trust in how the technologies like blockchaining are used, but more generally because there is no faith in the political and economic system, viewed from the international financial markets´perspective.

Source author: Eduardo Ruiz Mazon eruizm@sre.gob.mx