Cardano founder supports X community in challenging ECB's criticism of Bitcoin. ECB's skepticism countered with data showing Bitcoin's low involvement in illicit activities and recent positive developments in the U.S.
Cardano Founder Charles Hoskinson has thrown his weight behind the X community's robust defense against the European Central Bank's (ECB) ongoing doubts regarding Bitcoin (BTC). The X community swiftly retaliated against the ECB's assertions that Bitcoin is excessively costly and has succumbed to unlawful transactions.
Cardano Founder & X Community Challenge ECB
Commenting on the specifics disclosed through the X community notes embedded within the ECB's statement, Hoskinson stated, "The community notes effectively dismantled the ECB's argument." The X community's response draws upon insights from the same Chainalysis report cited by the ECB, dealing a significant blow to its accusations against Bitcoin.
The community notes emphasized that the Chainalysis report indicated a mere 0.34% of cryptocurrency transaction volume in 2023 was linked to criminal activity, with Bitcoin's share of illicit activity notably lower at 25%. Additionally, the notes underscored that illicit transactions involving the Euro (EUR) constituted 1% of the EU's GDP in 2010, equivalent to €100 billion.
This defense arrives at a pivotal moment, as the ECB's skepticism persists despite recent positive developments in the United States, such as the Securities and Exchange Commission (SEC)'s green light for Bitcoin ETFs. Despite Bitcoin's prevalence in money laundering, as highlighted by the Chainalysis 2024 report, the ECB remains unconvinced.
Furthermore, the ECB spotlighted that illicit addresses transferred $23.8 billion in crypto in 2022, marking a 68.% increase from the previous year. Additionally, they pointed out that almost 50% of these funds were laundered through crypto exchanges, despite their adherence to regulations.
What Accusations Did The ECB Level Against Bitcoin?
European regulators expressed skepticism about Bitcoin, despite recent ETF approvals within the region. In their latest publication, the ECB reiterated its reservations, underscoring Bitcoin's deficiencies as a digital currency and investment, notwithstanding ETF endorsements.
This stance disappointed enthusiasts who anticipated a shift in perception following the launch of Spot Bitcoin ETFs. The ECB highlighted Bitcoin's failure to establish itself as a global decentralized digital currency, emphasizing its susceptibility to fraud and manipulation. Moreover, the ECB pointed out Bitcoin's high costs, sluggish transaction speeds, and limited utility for lawful transfers.
The ECB remained unconvinced by the SEC's recent approval of Bitcoin ETFs, likening it to "The Naked Emperor's New Clothes." Despite Bitcoin attaining legal tender status in El Salvador and government endorsement, its mainstream adoption as a payment method remains limited, the ECB report noted.
Regulators also observed that beyond criminal activities on the darknet, Bitcoin transactions for legitimate purposes are infrequent. They highlighted that even initiatives to promote its usage, such as distributing free BTC to citizens, failed to ignite widespread adoption.