Bitcoin is "highly speculative". Or so Christine Lagarde thinks. In her opinion, cryptocurrencies require regulation at a global level.
The ECB is critical of Bitcoin
Central banks have always been skeptical about Bitcoin (BTC) and other cryptocurrencies. The European Central Bank (ECB) does not hide its negative attitude towards cryptocurrencies.
ECB President Christine Lagarde said in an interview with Reuters that Bitcoin is a "highly speculative" asset. It also drew attention to its use in money laundering and other illegal activities.
"For those who thought (Bitcoin) might become a currency - I'm terribly sorry, but it is an asset, and it is a highly speculative asset that ... (enabled) totally reprehensible money laundering activities"
Bitcoin needs regulation
Lagarde also called for regulation of the cryptocurrency market. Appropriate cryptocurrency laws must be in place, he says, and should be agreed at a global level.
"If there is a gate, it will be used ... So I think ... global cooperation, multilateral action is absolutely necessary," said Lagarde.
-She added that the regulation could be initiated by the G7 group.
It should be noted that Lagarde has advocated the need to regulate cryptocurrencies since 2018 when she was head of the International Monetary Fund (IMF). She said at the time that regulation was "necessary" and "inevitable".
Central banks consider their own "cryptocurrencies"
Although central banks are skeptical about cryptocurrencies, they are considering introducing their own, so-called Central Bank Digital Currencies (CBDC).
According to the BIS, around 80% of the world's central banks, including the European Central Bank, have been looking at the benefits and risks of digital currencies - at least since 2019, when the Facebook-backed Diem (formerly Libra) project was announced.
Lagarde said the ECB has now completed public consultations on the digital currency of the euro area. She also said the introduction of the digital euro should take no more than five years.