Within a speech released earlier this week, Fabio Panetta, an executive board candidate of the European Central Bank, slammed cryptocurrencies, stating that they had no purpose to operate. Notwithstanding the reality that the entire value of the bitcoin market surpassed $3 trillion in current years, Panetta claims that cryptocurrencies are neither good to humanity nor beneficial to the economy.
In fact, he says that cryptocurrency has a detrimental influence on the community owing to the deleterious environmental impact of mining, criminal activity related to cryptocurrency, and a lack of legal measures to safeguard investors. According to an ECB official, now that cryptocurrencies have reached such high prices, they represent considerable dangers to the world financial system.
Panetta also targeted fiat-backed cryptocurrencies, stating that they have been “unstable” owing to solvency difficulties. Although if stablecoins were completely guaranteed by reserve assets, their issuers would be more concerned with generating a profit than with serving the common good.
He made the argument for the creation of a central bank digital coin that would supplant cash as a mode of transaction. According to Reuters, Project Jura, a CBDC experiment of the digital euro and Swiss franc among both the central banks of Switzerland and France, was a triumph on December 9. Evelien Witlox, ING’s worldwide director of payments, was appointed the previous month to lead the ECB’s digital euro initiative.