European Central Bank Says Bitcoin Becomes Irrelevant as It’s Rarely Used for Transactions

Facebooktwitterredditpinterestlinkedinmailby feather

Is Bitcoin’s relevance coming to an end? In the midst of a horrible year for crypto, the European Central Bank officially released reports that show it’s rarely used for legal transactions. The report stated that Bitcoin is on a road to ‘irrelevance’ which is just about the worst thing investors want to hear. It follows the tune US regulators have recently been dancing to, creating a very negative outlook for the crypto market.

It has been a tough year for crypto and especially Bitcoin. The prices has dropped to below $17,000 again, and things aren’t looking great at all. The crypto market is in shambles, and it seems there’s no way out. With the European Central Bank’s negative report being that bad it’s pretty clear that the light on the horizon seems to be fading. Is the report true, or is the ECB overstating facts?

A Stringent Criticism

This isn’t the first time the European Central Bank has criticized Bitcoin. Or crypto in general. It even urged regulators to give crypto no legitimacy to digital tokens, making them all but obsolete. Bitcoin has suffered as a result of other factors, but the constant pushback from the European Central Bank has made things worse.

It’s no wonder that the price of Bitcoin has suffered this year like never before. Just over a year ago, it almost hit a record $70,000. Things have been bad since then. Bitcoin has lost over 80% of its value, currently holding on to dear life at a price around $17,000. It recently found stability at $20,000, but according to ECB officials, that was an ‘artificially induced last gasp’ before it hit the road to irrelevance. Then crypto exchange FTX went bust and sent the price to tatters. Bitcoin’s price went below $16,000, yet managed to climb up to $17,000 at the moment.

The ECB says that since Bitcoin doesn’t generate cash flow or dividends, it can’t be used productively. Nor does it provide social benefits. However, according to crypto experts, the report is emotionally driven bias and lacks strong data points. For example, one analyst posted a report which says that only 0.15% of crypto transactions were linked to criminal activities compared to 5% of traditional currencies.

Will you see the ECB bashing the Euro? Of course not.

Private Banks Continue Showing Support

While central banks in many countries have rejected crypto’s credibility, private banks continue showing support. That’s been the case with Goldman Sachs, Wells Fargo, Citigroup, Bank of America, Deutsche Bank, Morgan Stanley, HSBC, UBS, and the Commonwealth Bank of Australia. These banks and financial organizations have continuously supported cryptocurrencies one way or another and have backed up several crypto firms.

Of course, it’s not like things are rosy for cryptocurrencies right now. But, Bitcoin is still a thorn in the ECB’s side, so it’s no wonder there was a negative report. If you ask us, it’s not the first nor the last. Crypto will persevere, though, just like it did in the past. As long as we all keep coins in hard times, the market will exist.

December 7, 2022: • No Comments

Comments are closed.