ECB Says Cryptocurrencies Pose Only A Limited Threat To Financial Stability

According to the latest estimates from the European Central Bank, due to the infrequent use of cryptocurrencies as a payment instrument, they pose only limited risks to financial stability.

The latest ECB report says that asrecovery of the global economy, there is a renewed interest in crypto assets and an increase in prices. Although they initially received support only from retail investors, over time, some institutional organizations and non-financial institutions also began to use them in their activities.

Bank economists note that highvolatility makes Bitcoin a risky and speculative instrument, the consumption of huge amounts of electricity has a negative impact on the environment, and the possibility of being used for illegal purposes is a concern of regulators.

At the same time, further in the document, the ECB indicates that,Since cryptoassets are still rarely used for payments and have little impact on commercial institutions, they currently carry limited risks to financial stability.

Since last year, the European Union has been developing a new regulatory framework for the regulation of cryptocurrencies and stablecoins, and the governments of the participating countries are assessing the prospects for the launch of the digital euro.

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