Billy Bambrough* says a former European bank resident has slammed cryptocurrency, saying bitcoin is “not real” and is not the future of money.
Image: Mohamed Hassan
Bitcoin and cryptocurrencies have attracted strong criticism from the world’s central bankers this year – sparked, perhaps, by Facebook’s plans for its own bitcoin rival.
The bitcoin price soared in the first six months of this year, only to stall amid concerns lawmakers and regulators could be poised to crackdown on the nascent bitcoin and crypto industry.
Now, former European Central Bank (ECB) President, Jean-Claude Trichet has slammed bitcoin and Facebook’s Libra project, warning bitcoin is “not real” and not the future of money.
“I am strongly against bitcoin, and I think we are a little complacent,” said Trichet during a panel discussion at Beijing-based media group Caixin’s annual conference earlier this month.
His comments were first reported by the South China Morning Post newspaper.
“[Bitcoin] itself is not real, with the characteristics that a currency must have,” he said.
Trichet also slammed bitcoin and cryptocurrency speculation, which he branded unhealthy.
“Even if [the cryptocurrency] is supposed to be based on underlying assets, I am observing a lot of speculation,” said Trichet.
“It is not healthy.”
He added that buying a cryptocurrency is “in many respects pure speculation”.
Adoption of bitcoin and cryptocurrency has failed to live up to sky-high expectations since bitcoin exploded into the public consciousness in 2017.
Bitcoin soared in 2017 from less than $1,000 per bitcoin to almost $20,000, sparking a digital gold rush and making many early adopters overnight millionaires.
Trichet’s remarks come amid excitement in the bitcoin and cryptocurrency industry that China could be about to relax its strict crypto restrictions following a ban on bitcoin exchanges in 2017.
Last month, some bitcoin and cryptocurrency market analysts pointed to comments made by China’s President, Xi Jinping that the country should “seize the opportunity” of bitcoin’s blockchain technology as the reason behind bitcoin’s sudden rally.
“We are already in a domain which has much less physical currency,” President Xi said.
“Whether we are in a domain where that will be replaced with crypto? I have doubts there.”
Trichet’s comments echo remarks made by new ECB President, Christine Lagarde earlier this year when she warned cryptocurrencies are “shaking the system” – something that could signal a change in the ECB’s approach to bitcoin and crypto and potentially spur adoption.
Elsewhere, another former ECB president, Mario Draghi, has said that bitcoin and crypto “are not designed in ways that make them suitable substitutes for money”.
* Billy Bambrough is a freelance journalist. He tweets at @BillyBambrough.
This article first appeared at www.forbes.com
