BIS Develops a Global Cryptocurrency Monitoring System for Analysis and Control of Their Usage

The Bank for International Settlements (BIS), often referred to as the "central bank for central banks," has introduced a novel cryptocurrency monitoring system named Atlas. This system is designed to provide governmental authorities and regulators with insights into the distribution and utilization of digital assets.

Atlas, which was developed with the participation of experts from the Central Bank of the Netherlands, serves as a tool for dynamically visualizing the flow of cryptocurrencies. It amalgamates data from various sources, including public blockchains and information from exchanges, as well as individual users. This enables a clear understanding of how, when, and where cryptocurrencies are being employed.

The system encompasses dashboards that furnish information regarding diverse facets of cryptocurrency usage. For instance, it can track the quantity of Bitcoins converted into fiat currencies at various points in time and across different regions of the world. Such information can prove pivotal in evaluating economic activity and monitoring cross-border cryptocurrency flows.

Nonetheless, it is imperative to acknowledge that the Atlas system does not encompass all cryptocurrency wallets and can solely offer an approximate depiction based on the available data.

The Atlas system holds significant value for regulators and central banks, who are becoming increasingly interested in overseeing and regulating cryptocurrencies. In light of recent incidents, such as the collapses of cryptocurrency exchanges like FTX and Terra, regulators are growing increasingly concerned about the "risks" associated with cryptocurrencies and their decentralized nature.

The information provided by the Atlas system can assist regulators in assessing the economic potential and risks associated with cryptocurrencies. Cross-border cryptocurrency flows can wield substantial influence over the economy and are distributed unevenly across various geographical regions.

Such macrostatistical data can prove invaluable to central banks when analyzing economic activity and payment balance statistics. In certain countries, cryptocurrency transactions can constitute a substantial portion of cross-border transfers, and this data can aid in better comprehending their impact on financial stability.

Several monetary regulators have already gained access to the Atlas system, and their feedback and recommendations will be instrumental in refining this monitoring platform. In sum, the Atlas system is emerging as a pivotal tool for regulators in this new era of digital assets.