Cryptocurrencies in general are known to attract criticism from regulators and monetary authorities all over the world. Now, yet another notable figure is chiming in on this matter, claiming that Bitcoin “isn’t real”.
Why do financial institutions resist cryptocurrencies?
The fact that central banks in various countries are suspicious of cryptocurrencies is, in itself, not hard to understand. After all, decentralized digital currencies present a very real risk to the existing monetary structures in society.
The notion of currencies that are not dependent on central banks or other regulators could give rise to true financial freedom. However, this would come at the expense of existing central banks’ and financial regulators.
Consequently, it is not unsurprising that the former boss of the European Central Bank, Jean-Claude Trichet, is now criticizing cryptocurrencies. The ECB is arguably the most important central bank in all of Europe, and as thus, stands to lose a significant amount of influence if traditional monetary power structures shift.
Trichet’s comments came during a recent panel discussion at the China-based media group Caixin’s annual conference, this past weekend. His statements were then swiftly picked up by the local South China Morning Post news outlet.
“Bitcoin isn’t real”
According to the news report, Trichet came out swinging against Bitcoin, and made his stance quite clear. “I am strongly against Bitcoin, and I think we are a little complacent,” he said. “[Bitcoin] itself is not real, with the characteristics that a currency must have,” he then added.
Furthermore, he went on to argue that cryptocurrency and Bitcoin speculation is not “healthy”. “Even if [the cryptocurrency] is supposed to be based on underlying assets, I am observing a lot of speculation. It is not healthy,” before stating that buying cryptocurrency is generally “pure speculation”.
Although Trichet’s comments should come as no surprise, they present an interesting contrast to some governments who are warming to crypto. For example, the Chinese government is increasingly looking towards blockchain and cryptocurrency.
Just a few days ago, a report from China said that Bitcoin is “blockchain’s first success”. As such, it is becoming clear that China is beginning to warm to the notion of digital currencies. There are also persistent rumors that China is looking to launch a national digital currency.
Consequently, it will be interesting to see whether European regulators and financial authorities also begin to come around to cryptocurrencies. If Trichet’s comments are anything to go by, it appears that this is not going to come from the ECB at least.
Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the blockchain industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.