Wednesday, December 8

European Central Bank blames cryptocurrencies for inflation and raises crash alert

Through a report published on Wednesday (17), the European Central Bank (ECB) mentioned the growing demand for cryptocurrencies, considering it as a risky market, as well as the real estate sector.

No report, the European Central Bank (ECB) listed the cryptocurrencies that, according to him, could aggravate possible slowdowns in the financial market if the economic recovery plans.

In another note published on Tuesday (16), the ECB states that the current high inflation is being caused only by the price of energy and the rapid reopening of the economy, affected by the pandemic.

These reports are, at the very least, an affront to citizen intelligence. No wonder Bitcoin is being increasingly sought after as a form of protection against inflation. After all, fiat currencies, although stable in the short term, have only one future, which is to increasingly lose their purchasing power.

Blame Inflation

In an earlier report entitled “Why Inflation Is So High Currently” and published on Tuesday (13), the European Central Bank blames high energy prices and the rapid reopening of the economy.

According to the ECB, investors are looking for investment paths that promise significantly higher returns due to falling interest rates and rising inflation. This trend, according to the bank, has led to increased investment activity in market segments such as cryptocurrencies.

“Inflation is high today because it was so low last year”

As expected, at no time does the Bank take the blame for the unbridled introduction of more money into the market. Earlier this week, Bloomberg published an article highlighting that the Bitcoin showed deflation of 99.996% in the last 10 years.

Nor is it aware that the price of bitcoin is rising as other giant economies, such as the US, show record inflation levels, levels not seen for decades.

Since the ECB has cited the cost of energy, it’s also good to keep an eye on mining. Soon they will blame this activity, claiming that it is causing inflation.

Risk of correction in cryptocurrencies

In the report this Wednesday (17), the ECB issued a warning about the risk of correction in real estate markets for cryptocurrencies. Showing concern for its citizens, or better, with the possibility of its citizens protecting their purchasing power when migrating to assets like Bitcoin.

“Price correction risk has increased in some real estate and financial markets. […] The riskiest segments of the global financial markets have experienced increasing investor demand, with increased interest in new asset classes such as crypto-assets.”, points out the ECB report

As it is an open market, without being influenced by governments, price fluctuations are already common in Bitcoin, and other cryptocurrencies have been around for over ten years. There is nothing unusual here.

Despite these risks, people are obviously preferring to expose an asset that has a controlled issuance of new currencies. And this is such a great need precisely because no government can offer such a monetary policy, everyone is printing money ad infinitum.

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