HSBC chief executive Noel Quinn said the bank has no plans to launch a cryptocurrency trading desk or offer the digital coins as an investment to customers, because they are too volatile and lack transparency.
Europe’s largest bank’s stance on cryptocurrencies comes as the world’s biggest and best-known digital currency, Bitcoin, has tumbled nearly 50 percent from the year’s high, after China cracked down on mining the currency and prominent advocate Elon Musk tempered his support.
HSBC’s move marks it out against rivals such as Goldman Sachs, which Reuters in March said has restarted its cryptocurrency trading desk, and UBS which media reports said was exploring ways to offer the currencies as an investment product.
“Given the volatility, we are not into Bitcoin as an asset class, if our clients want to be there then of course they are, but we are not promoting it as an asset class within our wealth management business,” Quinn said.
“For similar reasons, we’re not rushing into stable coins,” he said, referring to digital currencies such as Tether that seek to avoid the volatility typically associated with cryptocurrencies by pegging their value to assets such as the US dollar.
Bitcoin traded at $36,387 on Monday, down nearly 50 per cent in just 40 days from its year high of $64,895 on April 14. It rose more than 8 per cent on Tuesday to $38,272.
Pressure on the currency intensified after the billionaire Tesla chief executive and cryptocurrency backer Mr Musk reversed his stance on Tesla accepting Bitcoin as payment.
However, Mr Quinn said that he was a believer in central bank digital currencies (CBDCs), which several countries including the US and China are working on.
“CBDCs can facilitate international transactions in e-wallets more simply, they take out friction costs and they are likely to operate in a transparent manner and have strong attributes of stored value,” he said.