Isabel Schnabel, a board member with the European Central Bank (ECB), has attacked bitcoin claiming the crypto asset â€œdoes not fulfill the basic properties of money.â€ She also describes bitcoin as a â€œspeculative asset without any recognizable fundamental value and is subject to massive price swings.â€ Schnabel also surmises that trust in â€œcryptocurrencies might rapidly evaporate,â€ and this, in turn, causes â€œdisruptions in financial markets.â€
The Digital Euro
In remarks made during a recent interview, Schnabel also reveals how she and her colleagues at ECB think â€œit is wrong to describe bitcoin as a currency.â€ Still, when Schnabel is reminded of billionaire Elon Muskâ€™s views on bitcoin, the ECB board member answered: â€œHe is at liberty to do so.â€
Meanwhile, Schnabel uses the interview opportunity to reiterate the ECBâ€™s resolve to create its own digital currency. However, she says a â€œgreat deal of preparatory work needs to be done to enable the project to be properly set up.â€ Schnabel also tries to justify claims that consumers would be more amenable to a digital currency issued by the ECB than one issued by private entities. She said:
As expected, Schnabelâ€™s comments sparked a quick reaction from some bitcoiners and cryptocurrency supporters on Twitter. For instance, responding to Schnabelâ€™s remark that the ECB is a trusted institution, a Twitter user Plan B said:
â€œPeople in Zimbabwe, Venezuela, Lebanon, Turkey beg to differ (after what central banks did to their money).â€
Human Rights and Data Protection
Alex Gladstein, the chief strategy officer at Human Rights Foundation, also weighed in by posing a question to the ECB board member. He asked:
Meanwhile, other users attacked Schnabelâ€™s assertion that â€œno other institution can offer a similar degree of security and data protection as the ECB.â€ For instance, user Ryan Cwynar reminds Schnabel that â€œliterally any cryptocurrency chain provides more security than any system your organization could design.â€
Still, a few users like Micheal Reilly, believe there is a place for both privately issued digital currencies and the one the ECB intends to create. He said:
â€œCentral bank policy is the least of the issues with any of those countries. Institutional failure or any institutional issue will and can affect everything in a country. CB is not the issue. I own Bitcoin and believe it has a use case and a digital euro is a good idea too.â€
What is your reaction to Schnabelâ€™s remarks about bitcoin? You can share your views in the comments section below.
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