EUROPEAN CENTRAL BANK RESIDENT SAID CRYPTOS ARE “WORTH NOTHING”
The current price of Bitcoin is just over $ 30,000, but Central Bank President of the United States Christine Lagarde thinks that along with other crypto assets "are worthless."
In a Dutch TV interview broadcast on May 22, Lagarde said he had been emphasizing that cryptos were "the most speculative, the most dangerous." The speculative part is general information, but the former Chairman of the International Monetary Fund then went on to announce:
“My humble assessment is that it does not work. It is not supported, there are no goods that act as a security anchor. ”
Why Central Banks Defy Crypto
There are a number of reasons why major banks and their leaders strongly oppose crypto. Distributed digital assets compete with their central banking disbursement schemes (CBDCs). Lagarde confirmed this in his next statement.
“The day we have the digital currency of the big bank, any digital euro, I will guarantee it. So the big bank will be behind it. I think that's very different from any of those things. ”
The CBDC will be fully regulated by the central bank. Based on the blockchain, all transactions will be tracked, so banks will enjoy a stronger leash over people's finances than they already have. Banks cannot control crypto, which is why they pull out all the stops to try and see the end.
In addition, the bank's job is to make a profit on the money invested by its customers. They operate a fractional reserves system, which means that banks lend and invest their customers' deposits, leaving a small portion as bank savings. If everyone goes to the bank in one day to withdraw, the bank will collapse because the funds are not real.
This is exactly what Satoshi Nakamoto warned against when he created Bitcoin after the 2008 financial crisis, caused by banks. The cycle is compounded by rising inflation and global banks are printing more and more money in the name of stimulus packages that reduce the value of capital.
Therefore, in response to the global economic crisis, banks are again raising their anti-crypto rhetoric. Earlier this year, Lagarde and the ECB called for strict regulation on crypto, citing evasion of sanctions as an excuse for this.
Crypto Markets are Cyclical
The crash of the crypto market is nothing new; occurred in 2018 and earlier in 2014, when BTC lost more than 80% of its pre-recovery rate to stabilize a new high stamp a year or two later.
The 2022 crypto bear market is expected, so this wave of mainstream media, policy maker, and bank FUD is uncertain.
Crypto markets are currently down 56% from November 2021 with a high value of $ 3 trillion so there may be more to do before it reaches the bottom of the current cycle.