Singapore Hopes Cryptocurrency ‘Crash’ Will Not Undermine Blockchain Technology

Singapore's central bank hopes cryptocurrencies would survive the eventual crash.

The head of Singapore’s central bank on Monday expressed the hope that the “much deeper and more meaningful” technology underpinning cryptocurrencies such as blockchain would not be lost in the event digital currencies crash as predicted by some experts.

Speaking at a UBS Wealth Insights event in the city-state, Monetary Authority of Singapore (MAS) Managing Director Ravi Menon stated:

"I do hope when the fever has gone away, when the crash has happened, it will not undermine the much deeper, and more meaningful technology associated with digital currencies and blockchain.”

Menon’s comments carry some weight to give the cryptocurrency space a much-needed boost. Singapore is doing extensive research into distributed ledge technology that is behind the development of digital coins, while at the same time issued warnings to the public about possible losses virtual currency trading.

 It also expressed concern about the vulnerability of cryptocurrencies from abuses by criminal elements, including money launderers.

Buffett Predicts Demise of Cryptocurrency

Ravi’s statement also came a few days after Warren Buffett, also known as the “Oracle of Omaha” because his investment picks and market commentaries are closely followed by the financial community – and he lives in Omaha, Nebraska – predicted that cryptocurrencies would not end well.

Buffett said in an interview:

“In terms of cryptocurrencies, generally, I can say almost with certainty that they will come to a bad ending. Now, when it happens or how, or anything else, I don’t know. If I could buy a five-year put on every one of the cryptocurrencies, I'd be glad to do it, but I would never short a dime's worth.” 

Although Buffee acknowledged, he really does not understand digital currencies and other blockchain-based assets. He would not invest in the space because he does not fully understand it, he added.

It is worth noting however that Buffett had been wrong before, especially on tech stocks. Buffett passed up on Google and Amazon years before because he did not believe those firms would succeed on the scale they enjoy now.

Singapore Mulls Own Cryptocurrency

Asked of Singapore is planning to launch its cryptocurrency to sell directly to the public, Menon said the government has not ruled out the idea, but added it would not be a good idea.

In late December, the MAS released a public warning to investors about the risks involved in digital currency trading.

“MAS considers the recent surge in the prices of cryptocurrencies to be driven by speculation. The risk of a sharp reduction in prices is high. Investors in cryptocurrencies should be aware that they run the risk of losing all their capital,” the regulator said in a press release.