- A new paper by ECB researchers argues that Bitcoin benefits early adopters at the expense of latecomers.
- Bitcoin analysts called this a “declaration of war.”
- Italy recently raised capital gains taxes on Bitcoin, signaling increased regulatory oversight in Europe.
European Central Bank (ECB) economists Ulrich Bindtheil and Jürgen Schaaf argue in a paper that Bitcoin's rise in value disproportionately benefits early adopters at the expense of latecomers and non-holders. It is claimed that it brings
Although this does not necessarily reflect the ECB's official position, the paper has triggered a discussion about the potential regulatory implications.
Bitcoin analyst Tour Demeester went so far as to call this a “declaration of war” on Bitcoin.
Demeester expressed concern that the ECB is preparing the ground for aggressive regulation, including tax increases and even bans.
bitcoin war
The paper argues that in a scenario where Bitcoin prices continue to rise, as early Bitcoin holders accumulate wealth without contributing to the productive economy, “Bitcoin's existence will drive both non-holders and latecomers into poverty.” “I will make it happen.''
It describes the situation as a “zero-sum game” in which early adopters “increase actual wealth and consumption” at the expense of those who enter the market later or not at all.
“This new document is a real declaration of war. The ECB claims early adopters of Bitcoin are stealing economic value from latecomers,” Demeester tweeted. “I strongly believe that the authorities will use this foolish argument to enact harsh taxes and bans.”
Demeester went on to argue that Bitcoin's technological innovations are being overlooked. “Rather than celebrating Bitcoin as a technology paradigm shift like oil or the internet, the authors argue that…early adopters profit at the expense of others.”
Join our community for the latest stories and updates
This is a notable policy change by the ECB. The ECB almost wrote off Bitcoin when the price fell to $16,000 in 2022.
At the time, the same authors wrote that Bitcoin was in the midst of its “last artificially induced gasp before the road to worthlessness.”
gloves are off
However, this latest paper warns that if the price of Bitcoin continues to rise, it could further divide society.
It suggests that the government will enact legislation “to halt the rise in Bitcoin prices or prevent Bitcoin from disappearing completely.”
Demeester concluded: “The gloves are off. It's clear that these central bank economists now view Bitcoin as an existential threat that should be attacked by any means necessary.”
There are already signs that European authorities are increasing their scrutiny of Bitcoin and cryptocurrencies. Italy recently announced an increase in taxes on Bitcoin, raising capital gains tax from 26% to 42%.
Virtual currency market movements
- Bitcoin is trading at $68,390, up 0.1% in the past 24 hours.
- Ethereum continues to trade at $2,645.
what we are reading
Ryan Salame says he's guilty and 'criminally' innocent in the mysterious case of jailed FTX executive DL News
Kamala Harris' team is considering these candidates to replace SEC Chairman Gary Gensler – unchained
DeFi can complement centralized financial systems, says Federal Reserve Chairman Christopher Waller – The Block
U.S. Attorney General demands jailed Binance executive hostage: 'bring him home' DL News
Kyle Baird is DL News' weekend editor. Any tips? email address: kbaird@dlnews.com.
