ECB President asserts “Cryptos are not currencies, full stop.”

ECB President, Christine Lagarde made anti-crypto comments on “The David Rubenstein Show: Peer-to-Peer Conversations“. On the issue of crypto’s global purpose and whether it’s too early to determine one, Lagarde claimed that the decentralized sphere is supported by a highly speculative asset class, which stands nowhere close to the definition of currency.

“Cryptos are not currencies, full stop. Cryptos are highly speculative assets that claim their fame as currency, possibly, but they’re not. They are not…I think we have to distinguish between cryptos that are those highly speculative, suspicious occasionally, and high intensity in terms of energy consumption assets, but they’re not a currency.”, she said.

ECB President on Stablecoins

The ECB President also discussed the issues related to stablecoins. Lagarde highlights that Stablecoins are expanding at a rapid pace with the help of big data. However, she argues that regardless of being different from mainstream coins, they still need to be put under regulatory sight. The ECB President emphasizes that Stablecoins may name themselves are less risky or volatile, yet they fall under the business of currency, run by private players.

“On the other hand, you have those stablecoins that are beginning to proliferate, which some big techs are trying to promote and push along the way, which are a different animal and need to be regulated, where there has to be oversight that corresponds to the business that they’re actually conducting, irrespective of how they name themselves.”

ECB President on CBDCs

Christine Lagarde upon reaching the topic of CBDCs switched her tone from offense to defense. She said that the CBDCs are merely launched in lieu of relevance in the era of technology. She further claimed that CBDCs are centralized digital currencies that make life easier in digital times, instead of making it riskier, unlike crypto. She also confirmed that CBDCs will not be mandatory and will go together with the traditional fiat, i.e., consumers will have the option to choose their preferred mode of payment.

“And in all that you have the central banks who are prompted by a demand of customers to produce something that will make the central bank and central bank digital currencies fit for the century we are in, which is why we are not all looking at CBDC… instead of having banknotes and cash in our pockets in our wallets, we can have exactly the same thing but in a digital form so all of us are working on this and certainly I was keen to push the issue, the CBDC issue, on our agenda because I believe that we have to stand ready for that.”