Like government authorities and financial entities around the world, European officials have been struggling to develop a sensible policy on Bitcoin and other digital currencies. Though some officials have openly praised digital currency technology for its innovative potential, others have decried it as a potential tool for criminals and terrorists. Many, including Austrian National Bank Governor and European Central Bank member Ewald Nowotny, have viewed cryptocurrency as a risk and called for strict regulations.
In a recent interview with The Trend, Nowotny not only doubled-down on his criticism of Bitcoin, but suggested that the European Central Bank has been discussing ‘legal constraints’ involving Bitcoin. In the interview, Nowotny asserted that Bitcoin is “not a currency” and remains volatile, unsupervised, and “highly speculative.” He also said,
“There is a particular problem in China, because bitcoins are used as a means to curse capital and to circumvent legal regulations. We are discussing the legal constraints within the ECB."
The idea that the ECB may be talking about legal constraints on digital currency might seem somewhat odd, given last month’s assertion by European Central Bank President Mario Draghi that “it would not be [within] our power to prohibit or regulate [bitcoin].”
Meanwhile, reports suggest that the European Parliament could introduce strong digital currency laws and regulations later this year. Those new rules could require monitoring of digital currency transactions and registration of all digital currency companies.