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Jean-Claude Trichet, former president of the European Central Bank has affirmed his doubts over cryptocurrency, claiming that it can never become the future and replace fiat currency.
Trichet is merely the latest anti-crypto member with a banking background to express a dislike over the new emerging technology of cryptocurrency that is perceived as a threat, which could dismantle the conventional system of international central banks by removing their firm control over currencies.
At the 10th annual conference of Caixin in Beijing, Trichet said that he is strongly against Bitcoin(BTC)trade during a panel discussion on Sunday. He stated that cryptocurrency is not real and doesn’t hold the features that a real currency has.
Trichet, who led the European Central Bank between the years 2003 to 2011, said that purchasing cryptocurrency is “pure speculation.” Prior to the ECB, Trichet had spent a decade in the post of governor for the Bank of France. He now believes that even if a digital currency is based on the actual backing of underlying financial assets (stablecoin), by observing a lot of assumptions, he has concluded that it is still “not healthy.”
Trichet’s remarks on the emergence of cryptocurrency go together with a lot of similar statements made by authoritative figures running the central banks around the globe. They believe that the increasing popularity of cryptocurrency could pose a threat to the banks sue to crypto’s characteristics, which aim to decentralize the economy and thus take away the banks’ command.
The Old Financial World vs. the New Crypto World
There are concerns that cryptocurrency can cause disruption to the international systems of finance and cause obstacles for the authorities in charge of controlling the value of money. Benoit Coeure (Seoure), a member of the European Central Bank’s board stated in September that growing emergence of cryptocurrency could cause challenges for the supremacy of US dollar, as previously reported by AllStocks Crypto News.
At the conference, the French economist also remarked his disapproval of Libra, not for the first time, stating that he is very much against it.
Libra is a digital currency project introduced by Facebook back in June, which received a lot of criticism from regulators and leaders of various countries including Germany and France. The social media company faced backlash for this decision, causing many original partners like MasterCard, Visa and PayPal to halt their support in the months that followed.
The nature of cryptocurrencies involves not having a centralized control of banks or administration. They can be traded freely and with no necessary requirements for identity and anonymous transactions. Such features are not available in the traditional money transfer through banks. The transactions are recorded through a blockchain.