Lord Michael Spence Says Bank of England Caused the Cryptocurrency Bubble

Whether you like being into crypto or not, one thing is certain — it is hard to evaluate DeFi projects and countless tokens issued by new companies popping up like mushrooms after heavy rain. There is undeniable value to Bitcoin, Ethereum, and some other tokens, but the vast majority of assets in the industry are nothing more than white noise.

By some estimations, it is expected that by the end of 2022, the crypto market will have over 12 thousand inactive tokens. We desperately need some cleansing and removal of useless tokens to allow cryptocurrencies with stronger fundamentals to thrive.

The bubble exists, but it is not as big as Michael Spence thinks

Lord Michel Spence was the Conservative Party Treasurer at the beginning of the 2000s. He is a well-educated economist and a respectable politician. However, his views of the crypto market are somewhat prejudiced. Recently, he has been very vocal about the current state of affairs in the global economy. He was especially harsh toward the Bank of England.

The politician blamed the financial institution by saying that the quantitative easing program that saw a massive bond-buying scheme released way too much money into circulation creating a favorable environment for financial bubbles. Lord Spence added that printing money is never a good practice. This time, it led to a rapid increase in cryptocurrency pumping which is the reason why the whole crypto market is considered a big bubble.

He also compared the hype around cryptocurrencies to the tulip bubble, a famous investment crisis that occurred in the 17th century in the Netherlands. The situation is indeed somewhat similar considering how little many investors know about the assets they are purchasing.

A couple of counterpoints

One of the core arguments against this notion is that Bitcoin is already too big to fall. It is used as an exchange medium in the international arena with countries like Iran and Russia using Bitcoin to avoid western sanctions. Even if the European Union will stop believing in BTC, many other entities need it.

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