Although the crypto winter of 2022 was perceived by many to be a disaster, Belgium considers it a blessing in disguise — according to the country’s Central Bank Governor Pierre Wunsch on Business AM.
The bank had previously expressed concern about the growing significance of cryptocurrency investments because of their possible effects on financial stability, Wunsch stated. However, he noticed that the financial stability is ultimately not affected by the crashes.
The bank was pleased by the fact that there wasn’t much “contagion from the crypto market” to “the equities markets” in its analysis of the Financial Year 2022. The governor remarked that, since there are few ties between regulated financial institutions and the crypto industry, the traditional financial system was relatively unaffected by the turmoil in the crypto markets.
According to the news source, the rise of cryptocurrency was at least momentarily stopped by the 2022 crypto meltdown. Business AM wrote that this was something that the financial industry didn’t want to happen.
Wunsch said that there were many parallels between cryptocurrencies and other financial bubbles. He also described the value of cryptocurrencies as being highly speculative. The media site stated that the report made a subtle reference to the dubious conduct of the cryptocurrency exchange FTX.
Business AM pointed out that central banks are not neutral in regards to cryptocurrencies. The media source cited the development of their own CBDCs as the reason for this.
