Christine Lagarde, the President of the European Central Bank (ECB) called for global regulation of Bitcoin due to its speculative nature and usage in money laundering activities. The former Managing Director of the International Monetary Fund (IMF) added that the anonymous nature of the world’s largest cryptocurrency has raised several concerns.
During her speech at the Reuters Next conference, Lagarde said that Bitcoin has conducted some funny business in the past including its usage in illegal activities. She asked for a comprehensive global regulation to cover the loopholes in Bitcoin.
“Bitcoin is a highly speculative asset, which has conducted some funny business and some interesting and totally reprehensible money laundering activity. There has to be regulation. This has to be applied and agreed upon, at a global level because if there is an escape that escape will be used,” Lagarde said during an interview at the Reuters Next conference.
The recent comments from the ECB President came after several regulatory authorities warned people about the risky nature of Bitcoin and other cryptocurrency assets. Lagarde criticized Bitcoin and other privately-owned cryptocurrencies in the past but she always supported the concept of a central bank digital currency (CBDC).
Despite the criticism against Bitcoin and digital currencies, Lagarde praised the digital euro and constantly discussed the latest developments on ECB’s digital euro project. During her speech at a virtual policy conference in November 2020, along with the Governor of Bank of England, Andrew Bailey, and Federal Reserve Chair, Jerome Powell, she said that the ECB will launch digital euro in 2-4 years.
The crypto market has gained significant value during the last few months. Bitcoin gained more than 300% in 2020. Ethereum, the world’s second most valuable digital currency jumped more than 400% during last year. The cryptocurrency market saw high volatility in the first few days of 2021 as the overall market cap of cryptocurrencies reached as high as $1.1 trillion but lost nearly $200 billion in value during the latest crash.