ECB Chief Mario Draghi says Bitcoin Not Mature Enough for Consideration
As Bitcoin closes in on a $100 billion market cap, world governments and banks are taking note, but Mario Draghi, chief of the European Central Bank (ECB), thinks cryptocurrencies are not mature enough to be considered as yet.
The ECB president was reportedly speaking at a press conference, where he said:
“With anything that's new, people have great expectations and also great uncertainty. Right now we think that especially as far as bitcoins and cryptocurrencies are concerned, we don't think the technology is mature for our consideration.”
Mario Draghi also went on to focus on the inherent risks that accompany the use of new fintech, such as cryptocurrencies. He did however acknowledge that there are benefits to the underlying technology.
“One of the lessons of the great financial crisis is that financial innovation, in this case it's financial and technology innovation... should be embraced with lots of attention to its potential risks.”
The matter of cryptocurrency regulation has kept coming up more frequently in recent months. We saw China take drastic measures, followed by South Korea and Russia. But then there are those who see cryptocurrencies positively as well.
However, the predominant approach at the moment seems to be governments working on their own, state-issued digital currencies. We already have news from Japan (J-Coin), Russia (CryptoRuble), Australia (Digital Australian Dollar) and there are talks of a fiat-backed digital currency in Kazakhstan as well.
Earlier this month, the Managing Director of the IMG, Christine Lagarde also spoke about cryptocurrencies and stated that massive disruptions are coming soon.
There are however issues with Eurozone countries creating their own digital currencies, as we saw the Estcoin initiative by Estonia being shot down in September by the ECB.
At that time, Mario Draghi had stated that no Eurozone country can have its own currency.
“I won't comment on the Italian intention but I will comment on the Estonian decision: no member state can introduce its own currency. The currency of the euro zone is the euro.”
It remains to be seen how the Eurozone and the ECB deal with increased interest in state-issued cryptocurrencies around the world.