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European Central Bank Board Member: Bitcoin is a Result of the Financial Crisis

An Eurozone chief monetary economist, Benoît Cœuré, applauded Bitcoin on Thursday stating that the cryptocurrency was an “extremely clever idea” in relation to financial crisis, but it suffers from “manifold problems.” Worthy of note is the fact that Bitcoin was created by Satoshi Nakamoto as a result of the global economic meltdown in 2008 which affected both developing and developed nations of the world. This exposes the corruption of banking and financial corporations in the world.

The economic recession further questioned the trustworthiness of the fiat currency system adopted by the world. The fixed supply of Bitcoin (BTC) would serve to counter inflationary prices made by an increased supply of money by the government.

During remarks at the ongoing Economics of Payments IX conference in Basel, Switzerland, Benoît Cœuré, who serves on the European Central Bank’s executive board, revealed that the inception of Bitcoin is clever but might not work out as currency. Cœuré, who chairs the Committee on Payments and Market Infrastructure at the BIS — which is nicknamed the “bank for central banks,” spoke at length on the technology behind cryptocurrency and how central banks could leverage it in their payment flows.

As posted in a tweet by Benoît using the European Central Bank’s handle,

“Bitcoin was an extremely clever idea. Sadly, not every clever idea is a good idea. Digitalization is the breeding ground for cyber-threats.”

He noted that the anonymous Satoshi Nakamoto developed Bitcoin when the Great Recession was hitting the world, and even going as far as permanently embody a headline in the UK bailouts in the network’s Genesis block.  Cœuré stated that; “In more ways than one, Bitcoin is the evil spawn of the financial crisis.”

Bitcoin Financial Crisis

Eurozone chief monetary economist could, however, not disagree with the fact that the idea for the Bitcoin inception was absolutely clever. Despite his assertion on Bitcoin, he still concurs with BIS chief Agustín Carstens’ that cryptocurrency is “a combination of a bubble, a Ponzi scheme, and an environmental disaster.” Cœuré was quoted as saying,

“Lightning may strike me for saying this in the Tower of Basel – but Bitcoin was an extremely clever idea. Sadly, not every clever idea is a good idea. The opportunities of the blockchain are many, but the problems of Bitcoin are also plentiful. I believe that Agustín Carstens summed its manifold problems up well when he said that Bitcoin is ‘a combination of a bubble, a Ponzi scheme, and an environmental disaster.’”

The Seeming Adoption of Cryptocurrency by its Biggest Critics

The economist further said that at least two-thirds of central banks have been studying Distributed ledger Technology (DLT) and are exploring how to implement it to create central bank digital currencies (CBDC) in order to facilitate international payment services despite the gross criticism of cryptocurrency by the banks. He, however, stated that it remains highly unlikely that a central bank will issue a digital currency within the next ten years

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