Could bitcoin threaten financial stability?

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The Head of the Federal Reserve Banking Oversight Official claims that cryptocurrencies took a vertiginous dive on Thursday after skyrocketing earlier in the week to more than 10 times its value at the start of the year.

As digital currencies like bitcoin gain wider use they could pose a threat to financial stability.

Though cryptocurrencies may not pose major concerns at their current levels of use; however problems may arise if they achieve a wider-scale usage.

If digital currencies could not be probably exchanged for the US dollar at a stable exchange rate during ‘times of adversity’ this could become a big problem to the system.