RBS boss compares Bitcoin to Dante’s Inferno, value continues to surge

As Bitcoins surge towards $16,000, the chairman of the Royal Bank of Scotland (LON: RBS) compared the cryptocurrency to Dante’s Inferno – warning of an apocalyptic ending.

Sir Howard Davies has called upon the Bank of England and other major lenders to start a campaign against the virtual currency, which he referred to as a“frothy investment bubble”.

“Put up the sign from Dante’s Inferno – ‘Abandon hope all ye who enter here’ – I think that’s probably what’s needed,” he said on Bloomberg TV.

Davies is not the only senior figure in banking to warn of Bitcoins. The heads of Goldman Sachs (NYSE: GS) and JP Morgan (LON: JMC) have said the currency should be outlawed due to its links with drug dealers and murderers.

According to reports, Wall Street banks are also fighting the launch of Bitcoin into the financial system. US lenders wrote a letter to US regulators, warning that the system was ill-prepared for the alternative currency.

Whilst major banks have expressed concerns, according to Davies, lenders are “nervous about not wanting to be seen to be luddites, saying all of these innovations are bad things”.

Bitcoins are not regulated by the Bank or the Financial Conduct Authority (FCA). Users have the ability to remain anonymous and users are vulnerable to hacks. 

Bitcoins have surged in value by $4,500 just this week. They have increased by over 900 percent this year.

Bitcoins have received an increased number of traders from established financial players. Australian Stock Exchange operator, ASX (ASX: ASX), announced on Thursday that it plans to start using the currency to process share transactions.

“To the extent that it helps them get the reporting details that they need, and potentially move more to more proactive action, we believe that it puts them in a position to do those types of things,” said Cliff Richards, executive general manager at ASX.

The cryptocurrency was trading at $15,800 late Thursday afternoon (GMT).