Regarding the price of Bitcoin which is moving very wildly, European Central Bank President Christine Lagarde thinks there needs to be a global level of rules regarding bitcoin. According to Lagarde, bitcoin is not a currency.
“(Bitcoin) is a very speculative asset that has done some funny business. And some of the money laundering activities are interesting and utterly despicable,” Lagarde said, quoting from Business Insider, Thursday (14/1/2021).
Bitcoin is not a currency as evidenced by the wild changes in value over the past few weeks. As is well known, cryptocurrency has jumped more than 300% in 2020. But after hitting a value above US $ 40,000 last week, the digital asset immediately fell by more than 20%. Recently, the price of bitcoin edged back up about 2% on Wednesday’s trade to US $ 34,350.
“I think there is a criminal investigation going on which I believe will continue,” Lagarde said.
There are Many Criminals Gaps related to Bitcoin
This criminal activity and legal loopholes around bitcoin are the reasons why digital assets need to be regulated at the global level.
“There must be regulations and this must be immediately implemented and agreed upon at the global level because if there is an escape, it will be used,” Lagarde said, adding that global cooperation was needed.
Lagarde sees rules regarding bitcoin as potentially starting at the G7 level. Then moving to the G20. And then expanding to other countries. Global regulation has been at the heart of the bearish bitcoin argument in recent years, but there hasn’t been any significant move on the regulatory side.
However, Treasury Secretary Steven Mnuchin proposed new rules in December. Namely, it requires certain crypto traders such as bitcoin to provide more information regarding their identity and transactions.