Christine Lagarde calling for global BTC regulation

Christine Lagarde calling for global BTC regulation

Christine Lagarde, president of the European Central Bank (ECB), expressed her opinion on Bitcoin again. She called for global regulation of this “highly speculative asset” that promotes “fun business”.

The head of the ECB has not changed the attitude to the BTC

On Wednesday, January 13, Christine Lagarde, president of the European Central Bank, called for global regulation of Bitcoin, in an interview at the Reuters Next conference. As such, she repeated her comments that global regulators should strengthen regulations to guarantee and improve BTC monitoring. She said that Bitcoin is used for money laundering in some cases, and any loopholes in the rules should be closed.

Speaking at the Reuters Next conference, Christine Lagarde said Bitcoin has led to “ridiculous business and highly reprehensible money laundering activities”. It is reported that during the interview, she did not mention specific examples of money laundering related to BTC, but referred to various criminal investigations of illegal activities related to their use.

She told the  reporters: “There should be regulations that would be implemented and approved around the world, because if there are loopholes, they will be used.”

Former ECB President Jean-Claude Trichet also expressed his opinion on Bitcoin in an interview in early January on Boursorama. The latter’s opinion is even more critical, as he explains that Bitcoin would not be anything at all if it were not for its rarity. He stated:

“They are sitting at their virtual Monopoly table, and they are particularly interested in playing with this instrument”.

He agreed with Kristin that BTC is used to finance terrorism, organized crime, and “all kinds of illegal transactions.”

Relatively surprising opinions when we know that only 1% of transactions in BTC can be illegal in nature, which is 3-5 times less than the euro or dollar, according to Chainanalysis.

ECB to decide on digital euro this month

The European Central Bank’s plans for a digital euro are gradually taking shape. Christine Lagarde confirmed that a response will be given in January if the institution comes to the conclusion that it is necessary to issue a central bank digital currency (MNBC). The European Central Bank launched a public consultation on the digital euro at the end of October.

The institute was sometimes evasive about MNBC, but there was still a noticeable change in the president’s rhetoric. She explained that the decision to start developing the digital euro will be made in January during an online forum. She also said that the ECB does not want to “chase the lead”, while unofficially confirming that the launch of MNBC is very likely: “We will decide whether we will move forward in the digital euro issue. It seems to me, but this decision will be made collectively, that we could well go in this direction”.

From two to four years of development

As always, the cautious Central Bank insists that this project will take time to implement. Lagarde did confirm that the project will take two to four years before a functioning digital euro is launched. She also drew a parallel with the Chinese digital yuan, which seems to be on the verge of being released, but about which little is known yet, but information is gradually coming in.

What is certain is that the ECB seems to be successfully developing a digital euro. The development time will be long, much longer than that of public cryptocurrencies. Will this give them a chance to become a real alternative? We will see in the coming years.