The U.S. pro-crypto pivot under President Donald Trump may come at a hefty price, one European Central Bank Governing Council member has warned.
From key appointments to executive orders, President Trump has paved the way to eliminate regulatory hurdles for the crypto industry. However, this embrace of crypto may come with significant risks, according to an ECB Governing Council member.
A Financial Crisis in the Making?
According to Francois Villeroy de Galhau, Governor of the Bank of France and ECB Governing Council member, the U.S.’s pro-crypto pivot under Trump risks triggering the next financial crisis.
“The United States risks sinning through negligence,” Villeroy told La Tribune Dimanche in an interview published on Saturday, March 15.
Villeroy argued that financial crises often originate in the US and spread to the rest of the world. He believes the Trump administration is sowing the seeds of future upheaval by encouraging crypto-assets and non-bank finance.
Villeroy’s statements largely align with the ECB’s seemingly unwavering crypto skepticism under President Christine Lagarde.
ECB Perception of Bitcoin and Crypto Under Lagarde Leadership
The ECB president has continuously argued that Bitcoin and other cryptocurrencies are worthless. Lagarde has also maintained that crypto and decentralized finance pose risks to financial stability. She has said no European central bank would adopt Bitcoin as a reserve asset.
Meanwhile, the ECB is far from the only multinational financial organization to hold this stance. The International Monetary Fund (IMF) has also warned of economic risks from unbridled crypto adoption. In a recent development, the IMF required El Salvador to stop Bitcoin accumulation to secure $1.4 billion in funding.
For many of these organizations, the series of interconnected crypto firm collapses in the 2022 bear market only helped to prove their point.
Nonetheless, crypto proponents continue to argue that fears of financial stability risks stemming from crypto are unfounded and born out of fear of embracing the future, like the Internet and the telephone before it.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
