TL;DR Breakdown
• Pieter Hasekamp, CPB head, indicates that the cabinet should ban cryptocurrencies.
• Cryptocurrencies could suffer an inevitable collapse, which is a huge risk for investors and the government.
Pieter Hasekamp, the central planning office CPB head, claims that cryptocurrencies will collapse and inevitable. He indicates that the Netherlands should ban cryptocurrencies immediately to avoid financial trouble.
Hasekamp indicates this is a risk for investors and world governments; for him, the last person to act is always the loser. These statements join global regulators calling for stricter regulations for cryptocurrencies.
In an essay published in the newspaper, Hasekamp also wrote that the Netherlands should ban cryptocurrencies, including Bitcoin.
Netherlands must ban cryptocurrencies
Hasekamp explained that several countries have decided to regulate cryptocurrencies to avoid fraud and losses in the financial market. Among the aspects to take measure include criminal use, fraud, money laundering, financing terrorism, and financial instability.
In his statements, Hasekamp indicates that the Netherlands must decide immediately because it is lagging. The Dutch government has tried to tighten and strengthen supervision of trading platforms but indicates that they have been unsuccessful.
The head of the central planning office, CPB, supported other countries’ move to ban cryptocurrencies or strictly regulate them. This action would involve banning the trade, production, and possession of digital currencies.
He indicates these measures would be difficult to comply with initially because financial institutions do not issue digital assets. These are traded internationally without the authorities having control due to their decentralized nature. Wopke Hoekstra, who is the finance minister, rejected the cryptocurrency ban measures in 2018.
Banning digital assets will lead to a value decline
Hasekamp reported that banning cryptocurrencies would automatically lead to a decline in the digital currencies’ price. He also explained that cryptocurrencies are used because people think that at some point, they will replace the traditional currency, and according to his criteria, this is not possible.
Cryptocurrencies are not physical money, nor are financial products. Instead, it is a clear example of what Robert Shiller, Nobel laureate, calls a “contagious narrative.” He indicates that cryptocurrencies are a contagious story where people believe in them because they also believe in these digital assets.
The CPB is part of the Ministry of Climate Economy and Policy, and the minister appoints its director in consultation with the other cabinet members. Despite this, the CPB is an independent department when it comes to the content of its work; indicated by the official website of the CPB.
As an independent central office, the CPB conducts its scientific research to make the best economic and financial decisions.
El Salvador has become the first country in the world to adopt a digital currency for daily use. The country’s president has indicated that Bitcoin is a legal tender within the country’s borders.
