Concerns have emerged in the banking sector about the ability for institutions to trust bitcoins from the point of view of complying with anti-money laundering and counter-terrorism financing laws. The blockchain that makes bitcoin work is less controversial. A blockchain project backed by 30 of the world's largest banks including Commonwealth Bank of Australia has said a global bank blockchain should be operating within a year.

Mr Stevens said if the banks demonstrated that using the blockchain was more efficient and cheaper, it would rapidly drive wider adoption.

"Various organisations, which are in that business are grappling with that question even now, as we speak. So that is fascinating, and I think, important," he said.

Give tech a chance

He said conducting business using new technology did not necessarily make it any riskier than doing it in old-world models, and suggested regulators should be willing see how things worked out.

Mr Stevens suggested governments should be willing to learn from problems that arise with the use of new options like peer-to-peer lending, or services like Uber and Airbnb, rather than stifling innovation with pre-emptive laws.

He compared the emergence of new business models to the earlier impact of scientific inventions and developments, such as the need to develop new road rules upon the introduction of the motor car and the need to rethink business supply chains once planes with jet engines became available.


"These [Airbnb and Uber] are fascinating and very important innovations. We don't really know where all that ends, and I think some of these things pose challenges for regulatory architecture, as well as incumbent businesses ... these are challenges we will have to meet," he said.

"It isn't the first time that innovations or new business models have challenged the existing order – the incumbents, the suppliers to the old world and the regulatory architecture. That has all happened before and it will again."

Using peer-to-peer lending as an example, Mr Stevens said there was essentially nothing to stop one person lending another $100 or $1 million, and that technology was just increasing the efficiency, and making it possible to bring more people together to do it.

"From a public policy point of view, my attitude would be, 'well, that's fine ... let it happen', until the day when a lot of innocent people lose a lot of money and felt things were misrepresented," he said.

"If that were to happen then you will find the regulatory community under pressure to adopt more oversight."

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