Crypto and Defi Could Pose ‘Real Risks’ to Financial Stability – Regulation Bitcoin News

Christine Lagarde, president of the European Central Bank, said crypto assets and decentralization (def) could pose “real risks” to financial stability. It has some control measures to increase the European market with Crypto Assets Regulation (MiCA) bill.

Lagard by Crypto Regulation

ECB President Christine Lagarde spoke at the European Parliament’s Economic and Monetary Affairs Committee on Monday about the cryptocurrency regulation. She said:

We believe that crypto assets and decentralized defenses have the potential to create real risks to financial stability when we begin this work on crypto assets and their potential risks.

“This is especially true if the crypto-asset markets and services continue to grow rapidly and the link between the two traditional financial sectors and the wider economy is strengthened,” he added.

However, “for the time being, the link between private sector crypto assets and traditional finance is still limited – for the time being.

Lagarde continued to talk about markets in the Crypto Assets Regulation (MiCA) account. The ESRB, which she heads, emphasized that the mission “supports the need for immediate acceptance and implementation.”

The ECB chief said he is encouraged by the growth of MiCA. However, she added: “It will not be implemented until 2024.”

Lagarde suggested some additional provisions for the current MIA Bill. Referring to MiCA’s account with additional resources such as MiCA2, MiCA2 argues that “financial institutions need to address their vulnerability to crypto assets.

“Decentralized finance should be fully covered and crypto staking and lending activities should be fully regulated,” she said.

What do you think of ECB President Christine Lagarde’s comments? Let us know in the comments section below.

Kevin Helms

Kevin, an Austrian economist, acquired Bitcoin in 2011 and has been an evangelist ever since. Its interests lie in the relationship between Bitcoin security, open source systems, network impacts and economics and encryption.

Image credits: Shutterstock, Pixabay, Wiki Commons

DisclaimerThis article is for informational purposes only. It is not an offer or request to buy or sell, nor a suggestion or support of any products, services or companies. Bitcoin.com does not offer investment, tax, legal or accounting advice. Neither the Company nor the author are directly or indirectly liable for any loss or damage resulting from the use or dependence of any of the Content, materials or services referred to in this Article.


Leave a Reply

Your email address will not be published.