UBS Chairman slams Bitcoin: Just a trading currency

FX168 Financial News Agency (Hong Kong) reported on Wednesday (October 4) that Axel Weber, chairman of UBS Group AG and former president of the German Federal Bank (Bundesbank), downplayed the potential of cryptocurrencies such as Bitcoin when talking about Bitcoin . Recently, several senior bankers have said that they are not fans of the digital asset class.

But while Weber believes the outlook for bitcoin looks bleak, he also said there is hope for blockchain technology.

He made the remarks at a conference hosted by the Swiss Financial Institute. Weber said that Bitcoin's shortcomings as a currency stem from issues such as its inability to play traditional roles such as payment methods, generally accepted assets and value stores. Weber said Bitcoin is only a transaction currency.

"People often ask me why I'm skeptical about Bitcoin, and that probably comes from my background as a central banker. The important functions of a currency are a means of payment, it has to be universally accepted, it has to be a store of value, and it has to be a transaction currency. And Bitcoin is just a transaction currency," Weber said.

Weber, a former policymaker at the European Central Bank (ECB), is one of a number of bankers who have expressed similar views on Bitcoin in less than a month. JPMorgan Chase ( 96.36 , -0.99 , -1.02% ) CEO Jamie Dimon recently commented that Bitcoin's prospects for survival are poor, saying it is a fraud that will eventually be exposed, and added that he would fire any employee who traded Bitcoin because he considered it "stupid."

Many other senior bankers have also recently attacked Bitcoin for a variety of reasons, including lack of government support, low interest rates and higher volatility.

Still, Weber is enthusiastic about blockchain technology, saying its potential is significant. UBS has been one of the most dynamic players in the field and that over time, digital ledgers will become widely accepted.