Cryptocurrencies, which have existed for a long time but have been in vogue for the last ten years, undoubtedly change several spheres of work, including that of the accounting community.
The growing interest in cryptocurrencies since 2009 lies in the fact that they are peer-to-peer transactions that do not pass through large banking institutions and whose rules of exchange are managed by the community that owns them. This completely virtual system is also based on the blockchain, described in an article in CPA Magazine as “a computerized registry which instantaneously records the transactions in chronological order.”
Are cryptocurrencies a passing fad?
Cryptocurrencies and blockchains primarily concern the financial environment. They affect consumers, investors and, in turn, the work of accountants as well. However, according to Jacky Chhan, an independent chartered account, the fashion of virtual currencies will pass. “There was a small speculative bubble between November 2017 and August 2018 which is deflating, as is the case with cannabis at the moment, which is inflating.”
Mr. Chhan says that cryptocurrencies have not directly affected his work, except for a few speculative clients who have to report gains and losses as a result of this kind of currency. He believes that the technologies derived from the blockchain will only be really mature and useful in five to ten years. According to the accountant, the impact of cryptocurrencies could especially be felt in processing transactions, which are currently unclear. “I can very well imagine something to replace the Visa, PayPal and TransferWises of this world, which collect very high fees on transactions,” Mr. Chhan says.
Cryptocurrencies also raise the issue of trust given to the value of money. “Since the end of the Bretton Woods Agreements, in 1973, whose key component was the convertibility of the American dollar into gold, confidence in the currency only flows from that which is owed to central banks, our institutions, and in their commitments to maintain inflation to about 2%,” the accountant explains. “Knowing that since 2008 [the banks] have printed a huge amount of money and injected liquidity in order to relaunch economic activity, as there therefore any risk of inflation?”, Mr. Chhan asks. In any case, for the moment cryptocurrencies have not yet transformed the work of accountants, but there is certainly a trend that they are watching closely…