German President Hopes Financial Sector Stems Cryptocurrency Bubble

February 2, 2018 11:23 PM

“When I look at the market developments of cryptocurrencies, I don’t see currencies. I see betting games,” pronounced president Frank-Walter Steinmeier on February 1, 2018. Speaking before a crowd of 1,000 guests at DekaBank in Frankfurt, Germany, Steinmeier noted the importance of curtailing potentially harmful market activities.

“Preventing new speculation acrobatics and formation of bubbles is primarily the responsibility of the financial sector,” he declared. Steinmeier asked, “Where do cryptocurrencies avoid regulation and steering through central banks? Where do they make possible money laundering, tax evasion and illegal businesses?”

The value that supports cryptocurrency trading often passes through normal, regulated institutions like banks and credit card companies, so it’s not reasonable for financial professionals to claim complete detachment.

Earlier this month, Joachim Wuermeling, a board member of Deutsche Bundesbank (the German central bank), spoke of the difficulty of virtual currency regulation. Given that cryptocurrencies are a global phenomenon, unilateral action by just one country or regulator would be ineffective.

“Effective regulation of virtual currencies would therefore only be achievable through the greatest possible international cooperation, because the regulatory power of nation states is obviously limited,” said Wuermeling.

Matthew is a writer with a passion for emerging technology. Prior to joining ETHNews, he interned for the U.S. Securities and Exchange Commission as well as the OECD. He graduated cum laude from Georgetown University where he studied international economics. In his spare time, Matthew loves playing basketball and listening to podcasts. He currently lives in Los Angeles. Matthew is a full-time staff writer for ETHNews.

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