Unbacked: Difference between revisions

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''Cryptoassets - debt.''
''Cryptoassets - debt.''


An unbacked asset or debt is one that does not have any additional support for its value.
An unbacked asset or debt is one that does not have any additional security, support or other backing for its value.




Revision as of 21:44, 10 November 2021

Cryptoassets - debt.

An unbacked asset or debt is one that does not have any additional security, support or other backing for its value.


Unbacked cryptoassets
"Unbacked cryptoassets make up nearly 95% of the [total]... Bitcoin, of course, is the most prominent example, but there are now nearly eight thousand unbacked cryptoassets in existence.
These have no intrinsic value – that is to say there are no assets or commodities behind them: the value of the cryptoasset is determined solely by the price a buyer is prepared to pay at any given moment.
As a result, their value is highly volatile... For this reason, the main use of unbacked cryptoassets is for speculative investment..."
Is 'crypto' a financial stability risk? - Bank of England - Jon Cunliffe, Deputy Governor, Financial Stability - October 2021.


See also

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