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Cryptocurrencies Won’t Replace Traditional Currencies

Olaf Scholz, the Finance Minister of Germany, is sceptical about the current trend of cryptocurrencies. He doesn’t think that it will be able to replace the traditional currencies, according to the news first reported by Cointelegraph auf Deutsch.

According to Scholz during a “citizens dialogue” at the German-Dutch Army Corps in Munster, he compared cryptocurrencies to the tulip fever bubble in the Netherlands in the 17th century, when it was thought that there would be a “tulip inflation”.He said, “I would doubt today, whether it has a perspective as a currency model.”

Scholz also added that the implementation of cryptocurrencies can be proved costly since it requires necessary computer processes. He continued by stating that cryptocurrencies need to be monitored closely by regulators since the popular digital currency can be misused for money laundering, terrorist funding or other illegal activities. “We do not believe that they already have an economically significant importance today.”

Over the last few weeks, European legislators have met in various capacities to voice out their concerns regarding the cryptocurrencies as well as possible solutions to rectify the problems related to the digital assets.
European Commission Vice President Valdis Dombrovskis has claimed in a recent meeting of the Economic and Financial Affairs Council in Vienna that “crypto needs further regulation”. He also stressted that the European Union (E.U.) will pay close attention on the development of crypto asset classification and regulatory mapping process.