Cryptocurrency is ‘based on nothing’, should be regulated, says the ECB’s Lagarde Cryptocurrency

European Central Bank President Christine Lagarde insisted that unlike a digital euro, the cryptocurrency has no underlying asset. It should be regulated to prevent people from losing their life savings by speculating in cryptocurrencies, the senior ECB official suggested.

Cryptocurrency is “worth nothing”, says the governor of the ECB

Eurozone monetary authority chief Christine Lagarde claims that cryptocurrencies are not “based on anything” and worries about people “not understanding the risks that are going to lose everything and that will be terribly disappointed, which is why I think , it should be regulated.

In a speech to Dutch TV, Lagarde admitted that she was skeptical about the value of cryptocurrencies, as opposed to a central bank’s digital currency (CBDC) such as the digital euro that the European Central Bank (BCE) plans to issue in the next few pairs. year. years. years. Regarding cryptocurrency, she also said:

My very humble assessment is that it is not worth anything, it is not based on anything, there is no underlying asset to act as a safety anchor.

The CEO of the ECB made the comments amid a difficult background for crypto markets, where major currencies such as bitcoin (BTC) and ether (ETH) fall 50% from their stock prices. peaked in 2021, Bloomberg reported. Cryptocurrencies are also facing increasing pressure and increasing control from regulators around the world, often citing threats to the financial system.

“The day we have the central bank’s digital currency, any digital euro, I will guarantee it – so the central bank will be behind it, and I think that is very different from many of these things,” Christine explained. The governor noted that she does not own any crypto assets, but admitted that one of her sons had invested in crypto against her advice and that she followed them “very carefully.”

Lagarde’s statements also come after other ECB officials have previously expressed similar concerns. In April, board member Fabio Panetta escalated the bank’s anti-crypto rhetoric by comparing the rise in cryptocurrencies with the subprime credit crunch of 2008 and the gold rush in the Far East. The West, while calling for global regulation.

Recently, Panetta said the digital euro could become a reality in 2026 and set a timetable for its launch. The project is currently in its research phase, and as the ECB now steps up its stakeholder engagement, the realization phase may begin at the end of 2023.

Keywords in this story

CBDC, Central Bank, Christine Lagarde, Crypto, Crypto Assets, Crypto Investments, Crypto Markets, Cryptocurrencies, Cryptocurrency, Digital Currency, Digital Euro, ECB, Eurosystem, Eurozone, Governor, Head, Lagarde, President, Regulation, Regulations

What is your opinion on the ECB’s position on cryptocurrencies? Share your thoughts on the subject in the comments section below.

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Lubomir Tassev

Lubomir Tassev is a technically savvy Eastern European journalist who loves Hitchens’ quote: “Being a writer is who I am, rather than what I do.” In addition to crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

Image credits: Shutterstock, Pixabay, Wiki Commons

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