ECB Senior Executive Calls For Online Gaming-Style Crypto Regulation

Fabio Panetta, a senior executive at the European Central Bank (ECB), believes that the bank should regulate cryptocurrency assets by regulations governing online gaming. Crypto, in his opinion, should be viewed as essentially speculative.

The European Central Bank (ECB) member Fabio Panetta wrote in a post on January 5 that trading cryptocurrencies should be viewed as gambling. As investors switched from having a fear of leaving out to a fear of staying in, Panetta asserted that 2022 would see the collapse of the cryptocurrency economy.

The cost to society of an unregulated crypto industry is too high to ignore, writes Executive Board member Fabio Panetta in the ECB Blog. Regulators should treat trading in unbacked digital assets as they would gambling activities.…

In his essay, he referred to Terra USD’s demise and noted how it had a domino effect on other crypto firms. He claimed that more crypto firms would be included in this list in the upcoming months.

Furthermore, The eventual self-combustion of crypto assets, according to Panetta, is unpredictable. He attributes this to his belief that crypto is a gambling establishment and defines it as a bet masquerading as a financial asset.

Because individuals will still want to bet, he does not anticipate them to vanish. Later, he claims that regulations are also necessary for cryptocurrency because of its hazards. In his perspective, which is pretty direct, the risky nature of cryptocurrencies necessitates that they are subject to the same regulations as online gambling.

Panetta Believes That Crypto Is flawed.

Additionally, digital assets have been categorically labeled as speculative and a bubble by Panetta in the past, making clear what he thinks of them. He stated in December that financial stability and lack of trustworthiness were incompatible.

He listed three fundamental problems with cryptocurrency: its lack of backing, stablecoins’ susceptibility to banking crises, and the market’s extreme leverage and interconnection. Anticipates that the market will remain a hotbed for speculation.

In addition, the European Central Bank (ECB) has been stepping up efforts to create the digital euro, the central bank’s digital currency. A piece of joint statement on legislative proposals with the CBDC was recently signed by it.

Related Reading | Mysterious Bitcoin Whale Awakens, Makes Massive $252.5 Million Transfer

Moreover, It’s been discussed for a while now to adopt a digital euro. An extensive set of laws have even been introduced by the EU, which has generally been suspicious about cryptocurrencies. It is also developing an energy efficiency score to categorize cryptocurrency assets.

Comments (No)

Leave a Reply