Analytics, Banks, Cryptocurrencies, EU – Baltic States, Financial Services

"The bubble has already started to collapse and maybe we should just see how far this collapse goes, and what is left when we’ve reached a new kind of equilibrium," the Estonian central bank governor told a conference in the Latvian capital of Riga. "I think we will come back a few years from now and say how could we ever have gotten into this situation where we believed this kind of a fairy-tale story."

Still, Hansson warned that authorities may need to focus on investor-protection aspects "if grandmothers start investing in that," and highlighted concerns that crypto currencies can be used for illegal activities. Financial-stability issues may arise if links between virtual assets and the regulated financial sector are starting to increase, he added.

While Hansson has voiced similar views earlier, the country's financial watchdog warned recently that it views companies providing services linked to crypto assets as a new source of money-laundering risks.