Crypto-assets show no signs of benefiting society or the wider economy, European Central Bank Executive Board member Fabio Panetta said.
While advocates frequently hail their ability to serve the unbanked segment of the population or strip out third parties, the ECB official argued “there is no sign that crypto-assets have performed, or are performing, socially or economically useful functions.”
“They are not generally used for retail or wholesale payments, they do not fund consumption or investment, and they play no part in combating climate change,” Panetta said at a lecture in Rome.
Central banks and regulators across the world are ramping up efforts to establish rules for cryptos such as Bitcoin, whose popularity poses a potential threat to existing monetary regimes.
Several authorities — including the ECB — are responding by exploring digital versions of their own currencies, hoping to keep up with the technological advances touted by crypto advocates.
Panetta criticized crypto initiatives for the “huge amounts of pollution and damage to the environment” they cause, as well as their role in criminal financing and tax evasion.
“On the whole, it is difficult to see a justification for the existence of crypto-assets in the financial landscape,” he said.
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