European Central Bank which is the one responsible for the monetary policy in the Eurozone recently noted that some crypto assets are identified as usable crypto assets. Following the latest cryptocurrency news, we read more about the new policy.
The European Central bank issued a new report named ‘’Crypto Assets: Implications for financial stability, monetary policy and payments and market infrastructures’’ which is about 40 pages long where the various implications on cryptocurrencies are explained for the financial stability in Europe.
The ECB now recognizes Bitcoin as a major crypto asset that has the largest market cap and considers Ethereum (ETH), Ripple (XRP) and Bitcoin Cash (BCH) as important in terms of usage. According to the data from Coinmarketcap, all of the three assets have a market cap of $25.9 billion, $16.7 billion and $6.8 billion respectively. According to the report:
“Bitcoin continues to lead the pack of crypto-assets in terms of market capitalization, user base, and popularity. There exist around 1,900 crypto-assets, up from 7 in April 2013. Next to Bitcoin, Ether, Ripple, Bitcoin Cash are considered the most important in terms of usage, market capitalization or business model diversity.”
The ECB still does not recognize cryptocurrencies as actual currencies and still names them ‘’Crypto assets’’ which can be sold and bought in the markets. Crypto assets according to the report as defined as ‘’new type of asset recorded in digital form and enabled by the use of cryptography that is not and does not represent a financial claim on, or liability of, any identifiable entity.’’
Crypto assets are smaller assets classes that have a market cap of about $250 billion which the ECB notes that these kinds of assets classes are not a threat to the financial system. The report goes on to say:
“The ICA-TF analysis shows that crypto-assets do not currently pose an immediate threat to the financial stability of the euro area. Their combined value is small relative to the financial system, and their linkages with the financial sector are still limited.”
As noted in the coming altcoin news, the European Central bank makes a difference between Blockchain and crypto assets and outlines that the blockchain can be implemented without crypto assets attached to it. Also, the banks have a very neutral stance on cryptocurrencies saying that this industry has to be closely monitored.
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