A powerful club of US regulators has warned that the growing popularity of bitcoin and other digital currencies is posing potential financial stability risks as it revealed they are being put under closer scrutiny.
A group that includes the Treasury department, the Federal Reserve and the Securities and Exchange Commission used an annual report on the biggest threats to the US financial system to highlight concerns about digital currencies for the first time.
Bitcoin has thrived as an alternative to currencies that are managed for governments by central banks, because it functions as a decentralised, or distributed, database for trusted transactions with no governing institutions.
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