- ECB’s Lagarde has said that BTC isn’t liquid, safe, and full of crime to be considered a reserve.
- But Bitwise’s Andre Dragosch has debunked these allegations.
The crypto community has criticized Christine Lagarde, the president of the European Central Bank, for her opposition to a Bitcoin[BTC] reserve among member countries.
In a recent presser, Lagarde stated,
“Reserves have to be liquid, secure and safe and not be plagued by suspicion of money laundering or criminal activity. As a result, I’m confident that Bitcoin will not enter the reserves of any of the central banks of the general council.”
However, the community quickly countered her argument, stating that Bitcoin meets all the criteria she highlighted.
BTC meets the ECB’s reserve criteria
Andre Dragosch, Head of Research at Bitwise Europe, noted that BTC is more liquid than the most liquid traditional asset (S&P 500). He stated,
“Is Bitcoin liquid? SPDR S&P 500 ETF (SPY) – trades around 22 bn USD in volume per day. Bitcoin just had 54 bn USD in trading volume over the past 24 hours.”
For safety, miners secure BTC, the most decentralized network with no counterparty risk. Dragosch added that one would need upward of $20B to corrupt BTC’s system, rendering it a relatively safer option.
As for criminal activity, crypto accounted for less than 1% of crime-related cases, per the 2024 Chainalysis report. The analyst added,
“Only 0.14% of all on-chain transactions are related to illicit activities, including money laundering. Bitcoin is only a fraction of that.”
Source: Chainalysis
Another user, Daniel Sempere, echoed Dragosch’s sentiment, reiterating that the Bitcoin network secures $2T in wealth and has never been hacked.
It’s worth noting that Lagarde’s comment was related to the recent Czech Republic’s move to diversify its national reserve by adding BTC.
Earlier in the week, the Czech’s Central Bank Governor, Ales Michl, reiterated the bank’s intention to add BTC to its reserves if approved.
Whether Michl will back down on BTC after Lagarde’s caution remains to be seen. In the meantime, Polymarket odds of another country adopting BTC briefly soared +70%.
Source: Polymarket
