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ECB’s digital euro ‘dilutes the value of money’ and ‘threatens privacy’

After ECB President Christine Lagarde spoke out in favor of regulating cryptocurrencies, there is a fresh debate about the digital euro. According to the ECB, this should supposedly be better than Bitcoin. But the opposite is the case, says financial expert Niko Jilch.

Published: May 28, 2022, 11:49 am

    Berlin

    In an interview with German daily Die Welt, he said that the top European currency watchdog was scaremongering about Bitcoin “so that we can accept the digital euro as an ‘alternative’ when it comes along”. But the proposed new currency is the opposite of Bitcoin.

    The digital euro is often sold as an officially approved Bitcoin alternative, but it is not: “The digital euro is centralized, its future and monetary policy is uncertain and is decided by a council, just like the analog euro.”

    On the other hand, with Bitcoin “everything is transparent and fixed”. The digital euro will also not be as open as Bitcoin. “But above all: It will not protect our privacy, as cash is currently doing.” The new ECB digital currency is “unfortunately a further step towards surveillance”.

    Jilch accused Lagarde of not distinguishing between Bitcoin and other cryptocurrencies in her criticism which is “simply wrong”. The expert underscored: “The truth is that we are dealing with an original and 10 000 imitators who would like to be like the original, but at the same time pretend to be even better.”

    The fact that the ECB President warned against cryptocurrencies, contrary to what she now claims, has nothing to do with protecting savers, said Jilch: “Lagarde also said that we should worry less about our savings and be happy when we have a job. As if that was thanks to her. That’s actually impudent.”

    The financial expert believes the reason for the interest in Bitcoin is actually because of the nefarious policy of the central bank. If the ECB “had not diluted the value of money at every opportunity, speculation – regardless of the asset class – would not be as intense.” That means: “The monetary policy of the ECB is to blame for speculation, not ‘crypto’ – that is just a symptom.”

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