Digital Assets: ECB’s Lagarde Lashes Out At Bitcoin
The central banker expresses concerns about bitcoin’s intense volatility.
European Central Bank President Christine Lagarde called Wednesday for co-ordinated, global action to regulate bitcoin. She drew attention to the roller-coaster moves in the leading cryptocurrency’s price and accused it of “funny business” and money-laundering. (Reuters)
Lagarde: Bitcoin and “funny business”
Lagarde was speaking in an interview at the Reuters Next conference. Here are quotable quotes:
- “It is a speculative asset by any account – I mean when you look at the most recent developments upward, and now the most recent downward trend.”
- “For those who had assumed that it might turn into a currency, terribly sorry but this is an asset and it’s a highly speculative asset which has conducted some funny business and some interesting and totally reprehensible money-laundering activity.”
- “…And there has to be regulations. And this has to be applied and agreed upon. It’s a matter that needs to be agreed at a global level, because you know if there is an escape, that escape will be used.”
- “So I think it needs to be…, if anything, it shows that global cooperation, multilateral action is absolutely needed – whether it is initiated by the G7, moved into the G 20, and then enlarged. But it’s something that needs to be addressed.”
- “And FATA is clearly an organization that has expanded in that respect.”
Lagarde did not back up her charges of funny business and money laundering with specific instances. However, bitcoin’s strident price rise beyond $41,000, and subsequent crash to just above $30,000 has drawn warnings from regulators.
U.K. FCA warns of risks
On Monday, the U.K.’s FCA warned investors that they could incur substantial losses by investing in cryptoassets or investments linked to cryptoassets.
“Investing in cryptoassets generally involves taking very high risks with investors’ money,” the FCA said.
It warned that consumers could lose all their money if they invest in these types of products.
New Zealand regulator red flags cryptoassets
On Tuesday, New Zealand’s Financial Markets Authority (FMA) warned Kiwis of the potential risks from cryptocurrencies.
“New Zealanders considering purchasing cryptocurrencies, such as Bitcoin, should be aware that these are high risk and highly volatile assets,” an FMA spokesman said.
Scammers and hackers exploit cryptocurrencies because they are not regulated in New Zealand.
“The FMA shares the FCA’s concerns that some crypto exchanges are promising high returns and customers should be prepared to lose all of their money.”
Related Story: Biden’s $3T Stimulus More Rocket Fuel For Bitcoin?
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