Trichet, former ECB President: Bitcoin is not a currency
RegulationBit News Today1 min read
Jean-Claude Trichet, the former president of the European Central Bank, has come out swinging against Bitcoin and the Libra stablecoin network in strong terms.
At a Caixin conference in Beijing on Sunday, Trichet bluntly said he is “strongly against Bitcoin” and “very much against Libra.”
The former ECB chief expressed serious reservations about the idea that Bitcoin or other cryptocurrencies could become the future of money. He said Bitcoin lacks the necessary characteristics to be considered a real currency, as he described it as “not real” and said it doesn't have the qualities of “real money.”
Trichet also criticized Facebook's Libra cryptocurrency venture, stating that he was firmly opposed to it. He preferred the International Monetary Fund's Special Drawing Rights (SDRs) backed by a global basket of fiat currencies.
A Multibank Digital Euro?
In a broader context, Trichet is the latest prominent monetary authority to warn about the power of Bitcoin and cryptos to disrupt the global economic order. In September, ECB board member Benoit Soeure remarked that cryptocurrencies might ultimately “challenge the supremacy of the US dollar.”
While serving as managing director of the IMF, current ECB President Christine Lagarde shared worries regarding how cryptocurrencies affect sovereign currencies and the challenges of protecting foreign exchange policies. This echoes concerns raised by Mario Draghi, the former head of the ECB, who opposed the creation of a state-backed Estonian eurozone cryptocurrency.
As Libra looms, European figures have called for central banks to look into digital currencies. In fact, the Association of German Banks, a lobby group representing over 200 private commercial banks, called for the creation of a "programmable" digital euro. They cited advantages like faster transactions and the ability to set up smart contracts.
