The European Central Bank continues to push for stricter rules for the crypto world, especially for stablecoins. Yesterday, Fabio Panetta, member of the board of directors of the European Central Bank, pushed for stricter regulations for cryptos. He wants stricter regulations to prevent any kind of “instability and uncertainty” at the financial level.
The ECB thinks the crypto market is a bubble
Panetta spoke at Columbia University. During his speech, he referred to the rapid growth that the crypto market has experienced. The market is worth more than $1.3 trillion, indicating that it is currently larger than any risky market when the global financial crisis of 2008 began.
Panetta said this massive growth is based on pure speculation and the promise of quick returns. He also shared that he believes the crypto market exploits loopholes that leave investors unprotected.
“We should not make the same mistakes by waiting for the bubble to burst and only then realize how great crypto risks have become in the financial system.”
– Fabio Panetta
Panetta also explained that stablecoins pose a risk to all countries in the world. That is a position that the European Central Bank has expressed many times before. The ECB says stablecoins could be disruptive to the world as those responsible for printing the tokens cannot guarantee that they will be redeemable at all times. Panetta added that a third of stablecoins launched in recent years have not survived.
