- ECB President Christine Lagarde firmly rejects Bitcoin for EU reserves, citing volatility and illicit activity concerns while emphasizing regulatory risks.
- A resurfaced 2019 video of Lagarde praising distributed ledger technology has fueled speculation about her preference for blockchain-based financial solutions.
- XRP proponents interpret Lagarde’s DLT remarks as an endorsement, believing XRP’s cross-border capabilities position it favorably for institutional adoption.
The position of European Central Bank President Christine Lagarde led to her opposition to Bitcoin usage for European Union reserves. Lagarde stated her reservations about Bitcoin because of its unstable nature and the perceived criminal connections to it. Her statements run contrary to the rising trend that several countries adopt Bitcoin for their national reserves. Multiple United States countries together with others have investigated Bitcoin for their asset portfolios while the Czech National Bank investigated implementing Bitcoin into its holdings.
The recent comments from Lagarde emerged shortly after Governor Ales Michl from the Czech National Bank disclosed his plan to incorporate Bitcoin into 5% of his country’s reserve holdings. Lagarde disagrees with both the global financial entities who view Bitcoin as reserves and stands against adopting this digital asset for national strategic reserves. Institutional investors cannot hold Bitcoin because its price volatility combined with regulatory complexities make it unfeasible.
A 2019 video interview of Lagarde focusing on distributed ledger technology recently became popular even though she maintains an unfavorable stance toward Bitcoin. In the recorded video she showed favorable views about distributed ledger technology (DLT) which presents disruptive potential to financial markets. The banking industry transformed digital financial innovations according to her observation. Her remarks from that period recognized the efforts of both incumbent banks and new disruptors adopting blockchain-based solutions.
During her 2019 discussion, Lagarde noted that major financial institutions were already experimenting with digital currency solutions. She cited an example of a large systemic bank launching a digital coin for institutional use.
Crypto Community Reacts to Lagarde’s Comments
The resurfacing of Lagarde’s past remarks has fueled debates about the future of digital assets in institutional reserves. While she dismissed Bitcoin, many believe her endorsement of DLT signals potential support for other blockchain-based assets. This has particularly sparked interest among XRP proponents, who see her statements as favoring their preferred digital asset.
XRP supporters argue that Lagarde’s focus on DLT aligns with XRP’s attributes. They emphasize its low-cost, cross-border transaction capabilities as key factors making it suitable for institutional adoption. As discussions on strategic crypto reserves continue, attention is shifting toward assets that offer efficiency within financial frameworks. Lagarde’s remarks suggest that the ECB might consider DLT-based solutions instead of Bitcoin.
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