Posted by • The White House recently released a report on digital assets, stating that they are problematic for consumers, the economy and the environment.
• The report also questioned the viability of a digital currency issued by the U.S. central bank but did not rule it out.
• Christine Lagarde, president of the European Central Bank, believes that a digital euro will be crucial in preserving European payment autonomy.
White House Report
The White House recently released a report on digital assets which highlighted their drawbacks across a lengthy 513-page annual report. It stated that some elements of the ecosystem for digital assets are problematic for consumers, the economy and the environment. This news comes amid growing industry anxiety that federal regulators are attempting to debank crypto businesses.
Central Bank Digital Currency
The research questions the viability of a digital currency issued by the U.S. central bank but does not rule it out, claiming that CBDCs could reduce credit availability and increase the risk of bank runs. However, Europe has a different perspective on this issue as Christine Lagarde, President of the European Central Bank (ECB), feels that having a digital euro will be crucial in preserving European payment autonomy and warned against depending on one supplier for important daily necessities being unhealthy.
Potential Advantages
According to the annual economic report from The White House there might be potential advantages realized in future from distributed ledger technology (DLT). As well as offering more efficient payments systems with faster speed and lower costs they can create new opportunities to share information securely between organizations or individuals with increased transparency which can have implications in various industries including finance, healthcare and government services such as tax collection or voting systems etc..
Risk Factors
Despite these potential advantages there are still risks associated with DLT such as cyber security threats or market manipulation activities like pump-and-dump schemes which could lead to substantial losses for individual investors who lack sufficient knowledge about these technologies or do not understand associated risks properly before investing into them . Furthermore , due to anonymity provided by cryptocurrencies it may also provide opportunities for criminals who want to avoid detection when conducting illicit activities .
Conclusion
Overall , although distributed ledger technology offers many potential advantages it comes with its own unique set of risks which must be carefully understood before investing into any cryptocurrency related asset . Moreover , due to lack of regulation and oversight within this space certain activities may go undetected leading to large losses for investors who do not have proper knowledge regarding this field .