Head of Ireland Bank’s Financial Conduct, Discusses Troubling Aspects Of Digital Investments - TCR

• The Irish Financial Regulator official is concerned about the rising popularity of cryptocurrencies, especially Bitcoin
• Derville Rowland of the Central Bank of Ireland called cryptocurrencies a speculative and unregulated investment vehicle
• The investment management sector lacks diversity and thus has a very long way to travel

The director-general for financial conduct at the Central Bank of Ireland, Derville Rowland, recently attended an interview, where she expressed “great concern” regarding the rising popularity of the likes of Bitcoin (BTC). The top Irish official views crypto-assets as “a speculative, unregulated investment” vehicle, joining the league of central bankers in this crypto debate.

Rowland, alarmed by the crypto boom, has warned the investors that they could very well “lose the whole of that investment” in cryptocurrencies. 

Derville Rowland: A Formidable Irish Financial Regulator Official

A formidable voice of the regulatory space, Derville Rowland is a force to be reckoned with. She has imposed heavy fines on some of the biggest Irish financial firms, including Davy Group, the largest stockbroker of Ireland. This July, Rowland is set to take over as the chairwoman of the European Securities and Markets Authority’s (ESMA) investment management standing committee, which prepares the fund industry regulations.

Central Bankers Express Concern Regarding Bitcoin 

Unequivocal in her criticisms, the director’s comments mirror the beliefs of several central bankers and financial market experts. Last month, Andrew Bailey, governor of Bank of England, said cryptocurrencies “have no intrinsic value,” warning crypto investors to be prepared “to lose all their money.” More recently, JPMorgan’s Chief, Jamie Dimon, said, although their bank offers crypto investment services, that’s a business decision; personally, he has advised people to “stay away” from it. And merely hours ago, the Bank of Japan’s Governor Kuroda reportedly questioned the “extraordinarily high” volatility of “speculative” trading, casting doubt on Bitcoin. 

Investments Management Sector To Travel A Long Way

Under troubling digital investments, Rowland also covered the ‘gamification’ of stock investing, which she foresees as a major issue for Europe. From online brokerages, like Robinhood Markets Inc., turning trading into a social activity, to subreddit groups wreaking havoc with the market shares of prominent firms, like GameStop Corp. and AMC Entertainment Holdings Inc., the financial industry is at risk. With that in mind, Rowland highlighted the need for “technology-neutral” regulations.

The digital investment industry is real and requires attention. For any industry, “decision making, risk control and performance” all improve with ‘diversity,’ and the “investment management sector is not diverse.” Rowland said the industry has “a very long way to travel.”