Mario Draghi, President of the ECB, at the ECON committee of the European Parliament, Brussels, 25 September 2017 "It would centantly not be in our powers to prohibit or to regulate Bitcoin" Hearing of the Committee on Economic and Monetary Affairs of the European Parliament
Cora van Nieuwenhuiz (ALDE)
Thank you, Mr Chairman. Welcome back, Mr Draghi.
I too would like to ask you two questions outside of regular monetary policy. The first one is about crypto currencies. It’s a very hot topic. China now prohibits the initial calling offerings and exchanges of Bitcoins and that is causing stress for international markets. And Mexico is introducing legislation to regulate FinTech firms and also those including crypto currencies.
In addition, your own Vice President, Vítor Constâncio, has called crypto currencies an instrument of speculation and compared the sharp rise in exchange rates to the Dutch tulip mania. So what is the ECB doing to mitigate the risk of crypto currencies? To what extent do you think that a regulatory framework is a necessary next step? Where do you stand – are you more on the Chinese side, in favour of prohibition, or on the Japanese side, in favour of regulation?
Mario Draghi, President of the European Central Bank
Well, on the question that we should ask, namely what are the material risks that Bitcoins pose to the economy, there are basically three channels to explore. One is size, another is users’ acceptance, and the third is the impact of Bitcoins on the real economy.
Examination of all three channels suggests that it’s really too soon to talk of a means of payment for the future. We need to think further. You asked me about what the ECB has decided. We haven’t discussed it. It would certainly not be in our power either to prohibit or do something of that sort or to regulate. But we certainly haven’t had a discussion about an institutional view. There are various views and you mentioned one.
More generally, and this actually applies to your second question too: our main worry now with these innovations in all fields of finance, Bitcoins along with others, is the potential fragility with respect to cyber risks. That, I think, is where we are really focusing our work now. And this should to some extent apply to other innovations as well.