Swedish Central Bank Confirms Bitcoin And Ethereum Are Not Currencies

Riksbank says Bitcoin is not a currency. (Unsplash)

JAKARTA – When the crypto market plummeted, the Swedish central bank, Riksbank, together with a number of other financial authorities stated that they rejected the notion of Bitcoin, Ethereum, and other cryptocurrencies as currencies. Riksbank also explained that cryptocurrencies are more like assets than currencies.

According to Riksbank, “money” must effectively function as a store of value, a medium of exchange, and a unit of account. Money acts as a store of value, meaning that its purchasing power and value will remain the same over time. Therefore money as a medium of exchange must be able to withstand the threat of inflation.

While Bitcoin and other cryptocurrencies have a high level of volatility. Through its Twitter thread, Sweden's central bank stated that cryptocurrencies are a poor hedge. The reason is, Bitcoin, etc, does not have the criteria as the currency mentioned above.

“Bitcoin prices are highly volatile and are therefore relatively poor hedges,” wrote Riksbank's official Twitter account.

In recent weeks, Bitcoin (BTC) as the number one cryptocurrency has experienced a decline in the past month. Causing the overall crypto market to plummet.

Based on data reports from Coingecko, BTC has fallen 29 percent in the past month, trading at 29,344 US dollars as of 7:18 p.m. EST on May 21, 2022.

Ethereum (ETH) has fallen even further by 35.9 percent in the past month. ETH is now trading at $1,973 per coin.