ECB board member Fabio Panetta, in his speech at Columbia University, criticized the cryptocurrency world, comparing it to the Wild West, while Bitcoin (BTC), Dogecoin (DOGE) and Ethereum (ETH) work with the Proof of Work (PoW) consensus. He claims that higher data can be obtained for cryptocurrencies.
“The Crypto world has turned into the Wild West”
“This is exactly Satoshi Nakamoto’s dream of creating reliable money — a dream,” says Fabio Panetta, saying that crypto assets create a new Wild West of instability and insecurity, which is the exact opposite of what they promised.
Having said that “chaos is a ladder”, quoting Littlefinger, the character of “Game of Thrones”, Fabio Panetta declares that the cryptocurrency market is a bubble ready to burst. “We should not repeat the same mistakes, waiting for the bubble to burst, and only then realizing how widespread crypto risk has become in the financial system,” Fabio Panetta said, noting that some crypto investors may be able to get out of the situation in time. but many will fall into the trap. ECB Board Member Compares Crypto Assets to Ponzi Pyramid, Saying:
As with the Ponzi scheme, this dynamic can only continue as long as an increasing number of investors believe that prices will continue to rise and that the nominal value may not be supported by any revenue streams or guarantees. Until the enthusiasm fades and the bubble bursts.
Higher tax on PoW coins such as DOGE, BTC, LTC
As we reported from Somagnews, we will also touch on crypto assets based on Proof-of-Work (PoW) blockchains. Fabio Panetta says that PoW-based cryptocurrencies such as BTC, ETH, DOGE and LTC can cause severe pollution and harm the environment.
“Therefore, crypto assets are speculative assets that can cause great harm to society,” said Fabio Panetta, who currently draws his value mainly from greed, relying on the greed of others and the hope that the plan will continue unchecked.
Based on this, the ECB board member states that the tax regime of crypto assets is minimal at the moment, and it is necessary to consider how they will be adequately taxed. And here he also opens the topic for cryptocurrencies working with PoW, such as DOGE, making the following assessment:
There may also be higher taxation of certain crypto assets, for example, based on PoW, in addition to taxation of other financial instruments. Negative externalities that lead to irrevocable costs for society, such as a high level of pollution, can be taken into account in the relevant taxes levied on participants in the cryptocurrency markets (issuers, investors and service providers).