Suppliers of stable cryptocurrencies could replace banks

The President of the European Central Bank (ECB), Christine Lagarde, has again expressed public views on digital assets. Recently, she said that financial institutions should not lose sight of the demand for stable cryptocurrencies.

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1 Banks may lose the role of intermediaries – the public would switch to stable cryptocurrency providers

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In a message posted on Twitter, Lagarde claimed:

“My personal belief on the problem of stable cryptocurrencies is that we must not lose the position of leaders. Clearly, there is a demand for these and we must respond. “

Stable cryptocurrencies are digital currencies based on an existing physical asset or currency and have the role of minimizing price volatility.

At the beginning of September, Lagarde was still the head of the International Monetary Fund (IMF) and was nominated to be the next President of the ECB. She then stated that it will focus on the ability of institutions to adapt to rapid changes in the financial industry:

“In the case of new technologies – including digital currencies – this means paying attention to risks in terms of financial stability, confidentiality or criminal activity. Adequate regulation must be provided to orient the technology to the public good. But it also means recognizing the broader social benefits of innovation and allowing this space to grow. ”

Banks may lose the role of intermediaries – the public would switch to stable cryptocurrency providers

Later in September, the IMF declared that the stable currency could bring significant benefits to customers and the company, but they are not without risks.

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Risks include the fact that banks may lose the role of intermediaries, as the public would switch to stable cryptocurrency providers. However, Lagarde predicted that banks will not disappear, as they will likely try to compete by developing their own innovations.

Lagarde’s position on digital currencies contrasts with those of previous ECB presidents – both Jean-Claude Trichet and Mario Draghi have expressed skepticism about this concept.