While the lack of regulation and use by criminals once formed the basis of attacks on Bitcoin, “bubble” is the latest condemnation used by skeptics. Credit Suisse CEO Thiam used the same logic to attack Bitcoin. Speaking at a news conference in Zurich, Thiam said:
“From what we can identify, the only reason today to buy or sell Bitcoin is to make money, which is the very definition of speculation and the very definition of a bubble.”
He went on to add that in the history of finance, such speculation has rarely ended well.
Banks have no appetite
Tidjane also pointed out that banks are regulated entities, with strict know your customer (KYC) norms and anti-money laundering (AML) regulations. Hence it would be difficult for them to deal with Bitcoin directly. Banks have in the past shut down accounts of Bitcoin-based businesses because of the increased scrutiny such accounts entail. According to Thiam:
Most banks in the current state of regulation have little or no appetite to get involved in a currency which has such anti-money laundering challenges.
Why are banks bothered?
Banks may have valid reasons, including strict regulations, which may prevent them from entering the Bitcoin space. However, this is no reason for them to attack Bitcoin, like Jamie Dimon and other bankers have done. Bitcoin threatens to disrupt the existing model, where bankers and regulators have a cozy relationship.
Banks which have a larger-than-life reputation and are too big to fail pose far higher systemic risk than cryptocurrencies. By trying to build hysteria about a Bitcoin bubble, its use in criminal activity, or the threat it poses to economic stability, Bitcoin opponents aim to goad regulators into taking action. The market seems to be ignoring the Bitcoin opponents, scaling new peaks regularly.