Bitcoin isn’t for everyone, but Jean-Claude Trichet – the European Central Bank’s former president – appears to have a serious aversion towards the cryptocurrency.
Trichet: BTC Is Not a Currency
At a recent summit, Trichet took a nasty stab at bitcoin, saying that it wasn’t even a currency and that crypto would not amount to much in the future. He said:
I am strongly against bitcoin, and I think we are a little complacent. The [crypto]currency itself is not real, with the characteristics that a currency must have… Even if the [crypto]currency is supposed to be based on underlying assets, I am observing a lot of speculation. It’s not healthy.
At this stage, to say something like bitcoin isn’t a currency is just pure ignorance. While the coin and others like it haven’t made much headway in terms of being accepted as a means of payment, this is seriously changing with the implementation of platforms like Bakkt, the new crypto institutional trading system owned by the Intercontinental Exchange (ICE).
Bakkt has partnered up with companies such as Starbucks that will allow customers to use bitcoin and other cryptocurrencies to pay for things like drinks, pastries and merchandise. While the company won’t necessarily keep the crypto it earns from customers, they can utilize bitcoin and other digital money to pay for their items. These coins will then be transformed into fiat by Starbucks or whatever company is accepting the payment.
The fact that more companies are allowing this makes bitcoin a currency. While it is still prone to volatility, if it’s being used to pay for items, it classifies as a valid form of money, and that volatility is likely to dissipate granted enough companies decide that bitcoin and other forms of crypto can (and should) be used to pay for goods and services.
Still, many men like Trichet refuse to see the light about what crypto and its respective technology can do. The 76-year-old bank manager now joins the ranks of figures like Warren Buffett, who has always been skeptical of bitcoin. Another example is Jamie Dimon, who has repeatedly referred to cryptocurrency as a fraud that’s “worse than tulips.”
At the same time, Dimon has recently introduced plans for his company – JPMorgan Chase – to develop its own digital currency. Thus, it can be argued that perhaps Dimon doesn’t want to face the competition BTC can ultimately bring.
Crypto Won’t Dominate Finance
Trichet further states:
I have great doubts about keeping control of monetary value in [the cryptocurrency] domain. In the so-called new stable international currencies… the SDR would be the right basket… We are already in a domain which has much less physical currency. Whether we are in a domain where that will be replaced with crypto? I have doubts there.