ECB’s Christine Lagarde: Further crypto regulation is an absolute necessity after the collapse of FTX

At the Committee on Economic and Monetary Affairs of the European Parliament on Monday, Christine Lagarde, president of the European Central Bank (ECB), said that regulating cryptocurrency in the European Union (EU) is an “absolute necessity”.

Fast facts

  • According to Legarde, the European Union (EU) has already begun making significant strides toward effectively regulating the space, referring to the Markets in Crypto Assets bill (MiCA), which is currently going through the European Parliament.
  • According to Lagarde, Europe is leading the pack [in terms of regulation]. But as I said previously, it is a step in the right direction. It is still not enough – a MiCA II is needed, which will encompass a broader scope of regulating and supervising.”
  • Legarde cited Meta Platform Inc.’s short-lived stablecoin project Diem as an example of when the  European Central Bank (ECB) was able to stop some industry players from becoming involved; however, she pointed out that FTX was different since it focused on the industry’s stability and reliability. The ECB( European Central Bank) has a role to play since consumers are increasingly interested in digital assets, she said.
  • The European Commission announced it would introduce a euro central bank digital currency in early 2023, while the European Central Bank has been developing such a project since July 2021.

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