ECB not convinced by ETF approval in the US, still dislikes Bitcoin


The European Central Bank (ECB) has reiterated its anti-crypto stance despite market optimism. The institution is unconvinced by the latest spot Bitcoin exchange-traded fund (ETF) approvals by the United States Securities and Exchange Commission (SEC). 

On Feb. 22, Ulrich Bindseil, the Director General of the ECB’s Market Infrastructure and Payments division, and Jürgen Schaaf, an adviser to the same division, published a post on the ECB’s official blog. The blog post’s headline speaks for itself: “ETF approval for Bitcoin – the naked emperor’s new clothes.”

The authors disagree with the claim that the approval of spot Bitcoin (BTC) ETFs in the U.S. confirms that BTC investments are safe and the preceding rally was “proof of an unstoppable triumph.” The fair value of Bitcoin is still zero, the bankers state:

“For society, a renewed boom-bust cycle of Bitcoin is a dire perspective. And the collateral damage will be massive, including the environmental damage and the ultimate redistribution of wealth at the expense of the less sophisticated.”

Bindseil and Schaaf cite their 2022 post on the same blog, arguing that Bitcoin has failed to fulfill its original promise to become a global decentralized digital currency. According to them, Bitcoin is also unsuitable as an investment, as it doesn’t generate any cash flow or dividends, cannot be used productively and offers no social benefit or subjective appreciation based on outstanding abilities.

Related: Digital euro will have better privacy than private systems, ECB exec says

The ECB executives agree that the expectation of the ETF approvals drove the price of Bitcoin, but they believe it could turn out to be “a flash in the pan:”

“There is no “proof-of-price” in a speculative bubble. Instead, a reflation of the speculative bubble shows the effectiveness of the Bitcoin lobby.”

The text concludes that the ECB’s job to control Bitcoin has not been done yet. Authorities should stay vigilant and protect society from money laundering, cybercrime, financial losses for the less educated and extensive environmental damage, they state.

On Feb. 19, in another column, ECB executives, including board member Piero Cipollone, provided counterarguments to claims that introducing the digital euro could cause an acute economy-wide banking crisis and that banks risk losing deposits as a source of refinancing in the long term.