Sweden’s Central Bank Governor, Erik Thedeen, warned against substantial Bitcoin integration into the nation’s financial system on March 12, citing its speculative nature and potential investor losses.
The Riksbank governor emphasized that Bitcoin doesn’t belong in Sweden’s financial system, stating that “the less, the better” for Bitcoin integration. Riksbank is Sweden’s central bank, overseeing its monetary policy and issuing its Swedish krona currency.
Bitcoin Not Welcome in the Swedish Financial System
Thedeen’s cautionary stance on Bitcoin comes at a time when the cryptocurrency has reached new record highs. Sweden’s central bank governor has now warned of possible losses to crypto users within Sweden’s financial system.
Sweden’s central bank governor throws shade at #Bitcoin.
Wants to limit it in the financial system due to:
1. Difficulty valuing it (no real backing)
2. Potential for consumer losses (remember those exchange crashes?)#Crypto
— MaMolefe (@Kealeboga___) March 12, 2024
In light of this, Thedeen emphasized that he’s working to keep Bitcoin trading outside of Sweden’s financial space.
He spoke to the media after a parliamentary discussion on monetary policy, addressing the valuation of Bitcoin.
The Riksbank Governor said that Bitcoin’s valuation is solely dependent on conjecture. This speculative valuation deters the practicality of its adoption.
Backed up his argument, Theeden mentioned the recent failure of cryptocurrency exchanges during an unprecedented bull run in the cryptocurrency market, which was driven mostly by Bitcoin.
The bank’s chief also discussed cryptocurrency’s implications for the stability of financial systems. He said that Bitcoin doesn’t alter Sweden’s financial system’s stability, but consumers risk losing investments.
He cited the example of Bitcoin collapse and losses to users in the US. Thedeen warned that citizens shouldn’t rely on the false hope of making free money.
This latest report represents the most recent dissenting voice against the adoption of cryptocurrencies in modern societies.
Sweden’s Pushback on Cryptocurrency and Mining
There have always been challenges to cryptocurrency-related activities in many jurisdictions, including Sweden.
Sweden was at the front when the European Union (EU) proposed a ban on cryptocurrency mining in 2022. The EU proposed the ban due to energy concerns.
This coincided with the heightened energy supply crisis in the EU, which prompted authorities to worry that renewable energy might be diverted from national networks and used for cryptocurrency mining.
Sweden removed tax breaks for data centers, which included the Bitcoin mining sector. In April 2023, the nation raised energy taxes by a whopping 6,000%.
The recent statement by Sweden’s central bank governor advocating for minimal adoption of Bitcoin in Sweden could have major repercussions.
This echoes Sweden’s previous efforts to ban cryptocurrency mining, which received support from regulators in Norway, Spain, and Germany.
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