January 17, 2021

The ECB calls bitcoin “highly speculative” and advocates regulating it globally


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The President of the European Central Bank (ECB), Christine Lagarde, has called for a global regulation of cryptocurrencies such as bitcoin, which she has described as a “highly speculative asset”, which, apart from “fun businesses” have also been shown to be used for “reprehensible” activities such as money laundering.

“It is a highly speculative asset,” Lagarde said, referring to bitcoin during the ‘Reuters Next’ conference, where he expressed the “absolute need” to address the regulation of these assets from a global perspective, “Since if there is an escape, that escape route will be used.”

“I think that global cooperation and multilateral action like the one started in the G7 and then transferred to the G20 is absolutely necessary, but it is something that needs to be addressed,” he said.

The price of bitcoin registered a rise of around 6% this Wednesday, reaching 34,822 dollars, a price that represents a 19% revaluation so far this year and more than 300% in twelve months, with an estimated market capitalization of almost 650,000 million dollars (534,327 million euros).

The price of the reference cryptocurrency marked last Friday orn all-time high of $ 41,962, although in the two subsequent sessions on Sunday and Monday it lost almost a quarter of the value, unleashing a wave of warnings from regulators such as the UK Financial Conduct Authority (FCA), which this week warned that investors were they risk losing all their money.

Euro digital in 5 years

On the other hand, and in an “absolutely different” category, the President of the ECB has highlighted the strong interest of European citizens in the development of a digital euro, which Lagarde hopes will be a reality in a period “of no more than five years”, although he has stressed that the creation of this centralized digital currency will not mean the disappearance of cash.

“It is difficult to say (how far we are from the digital euro) because in the fintech world things change ‘super fast’ and we not only need to be alert but to move forward safely,” explained the central banker of the euro zone, who has assured that it is not something “for tomorrow”, but that it will take time, although he has expressed his conviction that “there will be a digital euro” because the ECB must respond to the demand of citizens and “that demand is there.”

In this sense, the French has highlighted the record participation during the consultation period opened by the ECB since last October and which ended this Tuesday and in which 8,221 comments have been collected by citizens, companies and industrial associations.

According to the preliminary analysis of the responses received, 41% of the total asked the ECB to implement features in the digital euro to ensure the privacy of payments. Behind were aspects such as security (17%) or that has a pan-European scope (10%).

“The high number of responses to our survey shows the great interest of Europe’s citizens and businesses in shaping the vision of a digital euro,” stressed the member of the ECB’s Executive Board. Fabio Panetta.

The issuing institute will publish a full analysis of the responses received throughout the spring and it will be an “important” aspect to take into account in deciding whether to give the final go-ahead to the digital euro project.

The scenarios currently being considered by the Eurosystem in which the issuance of a digital euro might be necessary include that the growth in demand for electronic payments makes it necessary toA risk-free European and digital payment method, a “significant” drop in the use of cash as a form of payment, the launch of private forms of payment that raise regulatory concerns, and a widespread adoption of digital currencies by other central banks.

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