Norway's finance minister breaks ranks to say bitcoin may see a breakthrough if the price stabilizes

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Norway's finance minister breaks ranks to say bitcoin may see a breakthrough if the price stabilizes
Jan Tore Sanner (centre) has been Norway's finance minister since 2020.AFP/Getty Images
  • Norway's finance minister said bitcoin may see a breakthrough if it can shake off volatility.
  • His comments contrasted with the usually critical statements from policymakers.
  • Yet Jan Tore Sanner told Bloomberg he would still tell consumers to avoid crypto markets.

Norway's finance minister has said there may come a point where bitcoin stabilizes and shakes off volatility, adding that this could lead to a breakthrough for cryptocurrencies.

"It is clear that there may be a development over time, whereby you will be able to get more stabilization mechanisms in the currencies that can lead to greater breakthroughs and upheavals in the slightly longer term," Jan Tore Sanner told Bloomberg in an interview.

Bitcoin is one of the most volatile assets in finance, regularly swinging 10% in a day and recently losing half its value within weeks. The crypto asset was up 3% to $38,900 on Thursday morning, but was still 40% off its April record high.

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The finance minister's comments contrasted with the usually critical statements from policymakers and central bankers.

Bank of England Governor Andrew Bailey has said cryptocurrencies are not real currencies. And he said people should only buy them if they're prepared to lose all their money.

Read more: Getting paid in crypto instead of cash may sound crazy, but here's why you may want to - and the potential complications

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In the US, Treasury Secretary Janet Yellen has raised concerns that bitcoin is used for illegal activity such as drug trafficking and money laundering.

The crypto world is bracing for new regulations in the US, after the new Securities and Exchange Commission chief Gary Gensler said in late May that there "are many challenges and gaps for investor protection in [cryptocurrency] markets."

Sanner said he shares some of these concerns. Cryptocurrencies are popular with criminals and he wouldn't recommend consumers enter the market, he said.

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"There is no doubt that there is great interest in cryptocurrency both in Norway and internationally," Sanner said. "But so far it has been unsuitable as a means of payment."

He told Bloomberg that he cannot envisage cryptocurrencies breaking into the mainstream until they are properly regulated.

Sanner isn't the only policy maker to have found some positives in the crypto boom. The deputy governor of China's central bank said in April that bitcoin is an "investment alternative."

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