The European Central Bank (ECB) has reiterated its stance against cryptocurrencies, dismissing recent Bitcoin exchange-traded fund (ETF) approvals in the United States as mere hype and reiterating its belief that digital assets have no underlying value.
In a blog post titled "ETF approval for Bitcoin – the naked emperor’s new clothes," Ulrich Bindseil, Director General of the ECB's Market Infrastructure and Payments division, and Jürgen Schaaf, an advisor to the same division, took aim at the optimism surrounding the SEC's green light for spot Bitcoin ETFs.
The authors argue that the approvals, widely seen as a legitimizing step for Bitcoin, do not change their fundamental view that the cryptocurrency has no inherent value. They criticize the notion that the recent price rally serves as evidence of an "unstoppable triumph," instead attributing it to speculative anticipation surrounding the ETFs. They added:
“For society, a renewed boom-bust cycle of Bitcoin is a dire perspective. And the collateral damage will be massive, including the environmental damage and the ultimate redistribution of wealth at the expense of the less sophisticated.”
Bindseil and Schaaf wrote that they maintain that the “fair value of Bitcoin is zero,” echoing their position from a 2022 blog post. They contend that Bitcoin has failed to live up to its initial promise of becoming a global decentralized currency, and argue that its lack of cash flow, dividends, or productive use renders it unsuitable as an investment.
The ECB also dismissed the concept of subjective appreciation based on the merits of the technology, stating that Bitcoin offers no societal benefit. While acknowledging that the ETF approvals likely contributed to the recent price surge, the ECB executives warn that it could be short-lived.
"It is not unlikely that the recent price increase turns out to be a flash in the pan," they wrote, before concluding that the ECB’s job to control Bitcoin has not been done yet.
