Euro Central Bank Advisors Double Down on Criticism of Bitcoin
European Central Bank advisors have reiterated their criticism of Bitcoin, claiming that it has failed to become a global decentralized cryptocurrency and has instead become a victim of fraud and manipulation. In a recent blog post, Ulrich Bindseil and Jürgen Schaaf from the ECB argued that the approval of spot Bitcoin exchange-traded funds by the US Securities and Exchange Commission does not change the fact that Bitcoin is unsuitable as a means of payment or investment.
Bankers Say Bitcoin Transactions are ‘Inconvenient’
The ECB advisors also stated that Bitcoin transactions are still inconvenient, slow, and costly. They argue that Bitcoin is hardly used for payments outside of criminal activity on the darknet, even after El Salvador granted it legal tender status. Additionally, they claim that regulatory initiatives to combat criminal use of the Bitcoin network have been unsuccessful, and that Bitcoin mining continues to pollute the environment.
Other criticisms raised by the advisors include Bitcoin’s lack of suitability as an investment, its inability to generate cash flow, and its failure to offer social benefits. They also expressed concern that less financially knowledgeable retail investors are attracted to Bitcoin due to fear of missing out.
ECB’s Previous Criticism Coincided with Bear Market Bottom
This recent criticism follows an ECB blog post in November 2022, which stated that Bitcoin was on its “last gasp before the road to irrelevance.” Interestingly, this post coincided with a bear market bottom for Bitcoin following the collapse of crypto exchange FTX. Despite the ECB’s negative view at the time, Bitcoin has since risen significantly.
Hot Take: ECB’s Criticism Fails to Dampen Bullish Sentiment
The European Central Bank’s advisors have once again criticized Bitcoin, claiming that it is not a suitable cryptocurrency and has fallen victim to fraud and manipulation. However, these criticisms have not deterred the bullish sentiment surrounding Bitcoin, as the cryptocurrency continues to rise in value. It remains to be seen how these conflicting views will impact the future of Bitcoin and its adoption as a global decentralized currency.
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