The bank of Italy dropped some of their thoughts on crypto, let’s just say they are not feeling great.
Their main concern is that banks and companies are getting involved, crypto ETFs are launching etc. So if the crypto market crashes, it will impact the “real” economy too.
Secondly they see dollar-pegged stablecoins as a big part of the risk, if one becomes too important – like, a core part of the financial system and then fails. It could lead to people selling off US government bonds, which might cause problem in global markets.
And they are uneasy about euro-backed stablecoins issued by US Companies starting to creep into European payment systems. They think that threatens the European Central Bank’s grip on the euro – a direct challenge to Europe’s monetary sovereignty.
Perspectives!!!
Some big concerns is that:
- This whole thing isn’t just about “protecting investors” or “financial stability”. Let’s be real: Central banks like the bank of Italy exist to control the money supply, keep inflation in check, and manage TradFi system, so when they call crypto a threat what they often mean is “Crypto makes it harder for us to do our job – and challenges the monopoly we have over money”.
Sure, if crypto becomes tightly integrated with banks and corperation, and something breaks – like a major stablecoin depegs an ETF collapses – there will be consequences for people who even aren’t in crypto.
At the same time, Bitcoin and other decentralized assets were literally built to remove the need for central banks. Ofcourse they are not going to be comfortable watching more people buy BTC, use stablecoins or tap into DeFi protocols that run 24/7 with no central control.
So yes, the Bank of Italy’s warning is technically valid, but also self serving. At the end of the day:
- Bank of Italy sees risk;
- Crypto users see freedom. And both are probably right for different reasons.
Who wins in the end? Eric Trump said that TradFi is slow, broken, and outdated, and that if banks don’t keep up with block chain tech, they’re gonna be extinct in 10 years. But time will tell!
Nneka Uyam