European Central Bank warns over Bitcoin bubble

No love lost between the American stock market watchdog SEC (securities and exchange commission) and the management of the European Central Bank (ECB).

The reason for this fracas between the two organizations is the fact that earlier this year the SEC approved a series of Bitcoin ETFs which are now heavily traded on the American stock exchanges. According to the ECB, a Bitcoin crash towards zero remains possible.

Flash crash

We talked earlier this week about analysts thinking a Bitcoin flash crash is possible in the short term, but the ECB’s claim is actually of a bigger order. ECB policymakers warned in a blog post that they still believe Bitcoin has no value and can therefore go to zero, even though their transatlantic colleagues have decided to allow the largest digital currency to trade on the US stock exchanges (in the form of an Exchange Traded Fund).

The @ecb wants everyone to know about #bitcoin.

— Michael Saylor⚡️ (@saylor) February 22, 2024

The ECB’s Ulrich Bindseil and Jürgen Schaaf said about the SEC’s decision that:

The formal approval confirms that Bitcoin investments are safe and the preceding rally is proof of an unstoppable triumph. We disagree with both claims and reiterate that the fair value of Bitcoin is still zero,”, warning investors of an unruly reinflating of the “bitcoin bubble.”

Son of ECB boss Christine Lagarde

Last month I myself claimed that the approval by the SEC as well as the offering of a Bitcoin ETF by BlackRock, the largest investment fund, actually means that Bitcoin can no longer go to zero, as this ruling translates for the Americans that Bitcoin is now an accepted investment.

The ECB clearly disagrees. The American and English media were surprised by the news and disagree in turn with their colleagues.

The last time ECB tweeted about bitcoin pic.twitter.com/oLvjFq3teC

— PickGawd (@PickkGawd) February 22, 2024

I think the fact that ECB boss Christine Lagarde is a well-known Bitcoin basher whose son lost a small fortune by investing in the wrong cryptocurrency probably has nothing to do with it.