4 - 6 minute read
A prank video from March 17 has caused uproar in the crypto community after being shared as a breaking news story. The video shows European Central Bank (ECB) President Christine Lagarde admitting to Ukraine President Volodymyr Zelensky that a Digital Euro will be used for control over payments, citing a desire to not be reliant on an “unfriendly countries currency” or a currency provided by a “private corporate entity like Facebook or Google.” She also said she is “personally convinced that we have to move ahead” with the Digital Euro, and that “there will be control, you’re right. You’re completely right,” but suggested it would be a “limited amount of control”.
The original video was part of a prank series conducted by the makers of the YouTube channel “PDO”. The conversation was staged by the pranksters who used deep fake technology to superimpose the face of Ukrainian President Zelensky on an actor. The objective of their prankster’s conversation was to trick Lagarde into thinking she was talking to President Zelensky.
BREAKING: European Central Bank President speaks about plans to launch a digital euro (CBDC),— MASON VERSLUIS 🏆🔮 (@MasonVersluis) April 6, 2023
She says there will be control over payments.
This is HORRIBLE folks! Do NOT give into their control. Turn to crypto and $XRP, not this bullshit!
The harder they push control upon… pic.twitter.com/rfZ1Eh6Roa
The prank video generated a significant amount of social media buzz after it was shared by news aggregator Watcher Guru. However, soon after that, the original source was traced back to a prank video. Despite this, Lagarde’s comments have been heavily criticized by the crypto community, particularly about her mention that a Digital Euro would allow for control over people and payments.
Lagarde’s response has sparked fear among cryptocurrency investors, with some saying that it highlights the need for decentralized currencies such as Bitcoin. A significant section of the crypto community has voiced its objections to Lagarde’s comments. Some commentators have called on people to “turn to crypto and not this bullshit.” Others have seen the bright side of the situation, pointing out that Lagarde has made it all too clear to the masses where things are going, and that it should push people towards decentralized currencies.
Although the conversation Lagarde had was a prank, it does show the potential power that a CBDC could have over an entire economy, and the extent to which central banks could exercise control. But why is that such a bad thing? After all, central banks have long been using monetary policy to regulate their economies, and the introduction of a CBDC is just another tool to supplement their existing policies. As Lagarde mentioned in the video, terrorist attacks have been funded by anonymous transactions. Therefore, we can expect that if a Digital Euro is launched, it will have more robust reporting and monitoring procedures to counter such threats.
But it’s not just the financial regulation that worries investors. The idea of centralized control is anathema to the principles of decentralization that cryptocurrencies are built on. Markets such as crypto thrive on decentralization, which enables people to transact with one another without intermediaries, and without governments regulating it.
It’s too early to tell whether a Digital Euro will indeed be launched next year, following the results of the two-year investigation that the ECB began in July 2021. Despite the prank, Lagarde has been clear on her opinion of the Digital Euro, saying that it represents a “fundamental shift in the way we perceive and use money.”
As traders, the best course of action is to wait and see whether the Digital Euro is launched, and what consequences it has for the crypto market. Investors should keep an eye out for any regulatory changes that could impact the value of cryptocurrencies, and monitor any updates regarding the investigation into the Digital Euro’s feasibility. The fact that a prank video could generate such a buzz shows how sensitive the market is to any news regarding cryptocurrencies. Investors should proceed with caution and avoid making any impulsive trades based on sensationalized news.