ECB not convinced by ETF approval in the US, still dislikes Bitcoin

The ECB Maintains Anti-Crypto Stance Despite Market Optimism

The European Central Bank (ECB) remains steadfast in its opposition to cryptocurrency, even as the market shows signs of positivity. The institution remains unconvinced by the recent approval of spot Bitcoin exchange-traded funds (ETFs) by the United States Securities and Exchange Commission (SEC).

On February 22, Ulrich Bindseil, the Director General of the ECB’s Market Infrastructure and Payments division, and Jürgen Schaaf, an advisor to the same division, published a blog post on the ECB’s official website. The title of the post speaks volumes: “ETF Approval for Bitcoin – The Naked Emperor’s New Clothes.”

The authors reject the notion that the approval of spot Bitcoin ETFs in the U.S. is proof that BTC investments are secure and that the recent market rally was an “unstoppable triumph.” They argue that the fair value of Bitcoin is still zero:

Bindseil and Schaaf refer to their 2022 post on the same blog, in which they state that Bitcoin has failed to fulfill its original promise of becoming a global decentralized digital currency. They also believe that Bitcoin is not a suitable investment, as it does not generate any cash flow or dividends, cannot be used productively, and offers no social benefit or subjective appreciation based on exceptional abilities.

The ECB’s Efforts to Control the Impact of Cryptocurrency on Society

According to executives at the European Central Bank (ECB), the recent surge in the price of Bitcoin was largely driven by the expectation of ETF approvals. However, they caution that this may only be a temporary phenomenon and that their job of regulating Bitcoin is far from over.

In order to protect society from issues such as money laundering, cybercrime, financial losses for the less educated, and environmental damage, the ECB stresses the need for continued vigilance and regulation of the cryptocurrency market.

In a recent column, ECB executives, including board member Piero Cipollone, addressed concerns that the introduction of a digital euro could lead to a banking crisis and the potential loss of deposits as a source of refinancing for banks in the long term.

Despite these concerns, the ECB remains committed to finding a balance between regulating the global cryptocurrency market and allowing for innovation and growth in the sector.

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