On June 17, 2018, the Bank for International Settlements (BIS)
released Cryptocurrencies: looking beyond the
hype within Chapter V of its Annual Economic Report
(Chapter). While cryptocurrency advocates purport that it will
unseat trusted, long-standing institutions, the Chapter notes that,
looking beyond the hype, it is hard to identify a specific economic
problem within the existing monetary landscape that these new
currencies solve. Today's crypto transactions are slow, costly,
and prone to congestion, consume vast amounts of energy and cannot
scale with demand. Further, the decentralized consensus is fragile
because of its need for trust between honest network participants
who, in turn, must control the majority of the network. However,
the BIS does see promising non-cryptocurrency-based use-cases that
leverage the underlying distributed ledger technology (DLT).
