Mexico's central bank chief stated on Thursday that Bitcoin is more equivalent to barter than "evolved" fiat money.
Bitcoin is somewhat like a barter instead of “evolved” fiat money, Mexico’s central back chief said on Thursday. He believes it to be a high-risk investment and a poor store of value. Alejandro Diaz de Leon governor of Bank of Mexico means that Mexico won’t be following El Salvador’s mistake in the future.
“Whoever receives Bitcoin in exchange for a good or service, we believe that (transaction) is more akin to bartering because that person is exchanging a good for a good, but not really money for a good,” said Diaz de Leon. “In our times, money has evolved to be fiat money issued by central banks,” he said. “Bitcoin is more like a dimension of precious metals than daily legal tender.” Diaz de Leon stated that the value of cryptocurrencies has gone up in its past days.
“People will not want their purchasing power, their salary to go up or down 10 percent from one day to another. You don’t want that volatility for purchasing power. In that sense, it is not a good safeguard of value,” he said. This adoption of Bitcoin earlier this week as legal tender by El Salvador has been the beginning of all problems that have created a pathway to the value of the digital currency globally.
Bitcoin has always been volatile. During April, it increased up to $64,000 and went down as low as $30,000 in May.