The Bank of England (BoE)’s latest Financial Stability Report, released twice yearly, acknowledges that increased crypto trading action and price volatility in 2021 signal that the sector is harboring “potential pockets of exuberance.”
The report notes that the top market cryptocurrencies, Bitcoin (BTC) and Ether (ETH), saw a sharp appreciation in value over the 12 months to April 2021 and that their subsequent drop by roughly 50% in May has left them “particularly volatile,” with prices skewed to the downside as of last month.