The European Central Bank (ECB) President Christine Lagarde’s recent statement on the digital euro has stirred up controversy in the cryptocurrency community.
Limited control over digital euro
Lagarde’s remarks on the digital euro have raised concerns among cryptocurrency enthusiasts who believe that the digital euro will be used for greater control over people and payments.
In the video, Lagarde admits that there will be some control over the digital euro, but she suggests that it will be limited.
She also mentions that the ECB is considering having a mechanism where there is zero control for very small amounts, around 300 or 400 euros, but warns that it could be dangerous.
Lagarde’s statement has been met with criticism, with many crypto enthusiasts expressing concern about the centralization of power that comes with the digital euro. You can watch the full video below:
Lagarde’s statement was later revealed to have been taken from a prank video that was filmed three weeks earlier.
The crypto community has been vocal about their belief that cryptocurrencies should be decentralized, allowing users to have more control over their finances.
ECB’s concerns about cryptocurrencies
Lagarde has previously expressed concerns over the growth of cryptocurrencies and their threat to the traditional banking system. She has claimed that the rise of crypto assets could hinder the role of central banks as an ‘anchor’ of the economy, demanding greater oversight over the crypto industry and the assets she said were “worth nothing.”
Finbold had reported on the ECB’s plans around the digital euro introduction in February 2023, which prioritize e-commerce and person-to-person payments during the first phase of the CBDC release, followed by other contexts, such as physical stores and government payments, in the second phase.
The banking crisis and CBDC
While the digital euro remains a topic of debate, speculation has been mounting that the banking crisis in the United States was a ploy with an aim to accelerate the adoption of CBDCs.
Nic Carter, the General Partner at Castle Island Ventures, said that the recent turmoil strengthened “the political case for CBDCs,” as “no one trusts commercial banks” anymore.
The digital euro is still in its early stages, and it remains to be seen how it will be used in the future. However, Lagarde’s statement has made it clear that the ECB is considering greater control over the payments that people can make with the digital euro.
For now, the crypto community remains skeptical about the potential impact of the digital euro on decentralization and individual privacy.
