INTERNATIONAL - Mark Mobius is sensing danger in the explosive growth of crypto-currencies.
Governments will begin clamping down on digital currencies because of their use in illicit financing, with terrorist groups to drug dealers contributing to their rise, Mobius, executive chairman at Templeton Emerging Markets Group, said in an interview in Hong Kong yesterday.
“Crypto-currencies are beginning to get out of control and it’s going to attract the attention of governments around the world,” Mobius said. “You’re going to get a reversion back to gold because people are going to wonder: ‘Can I really trust these currencies?’”
And the crackdown may have already started - at least in China, home to the majority of bitcoin miners. The People’s Bank of China said yesterday initial coin offerings were illegal and that all related fund-raising activity should be halted immediately.
The central bank said it had completed investigations into organisations and individuals who have conducted so-called ICOs, and had ruled that such activities disturb financial order and would therefore be banned. In the US, both the banks and regulators are study- ing distributed ledger technology.