In June, the Dutch Authority for the Financial Markets (AFM) issued a letter of concern. In it, they doubted whether cryptocurrency operations conform with the country’s licensing law. Now, the Dutch central bank has come up with a new critique: cryptocurrency is not real money, according to it.
Bank divisional director Petra Hielkema has made it clear why she thinks so: “If something wants to be treated as money, you have to be able to spend, save and calculate with it. However, things are not often bought with cryptocurrencies, it is too volatile for savings and its value is expressed in real money. So we do not consider it to be money as such.”
The logic is understandable and yet doubtful at the same time. If cryptocurrency is not money, then how come you can buy things with it? This is good food for thought, especially since some researchers have already proven that crypto partially meets money criteria.
However, while the Dutch bank is not that enthusiastic about the cryptomarket it does consider blockchain to be interesting. “We have been experimenting with the technology for the past three years and have developed four prototypes,’ Hielkema said.
She also added that the experiments have shown that it is too early to adopt the technology. However, the result still looks promising, as it provides “possibilities in the future, with more innovation.”
The remarks by Hielkema show how unwilling the Dutch authorities are when it comes to crypto. Thus, back in March the Dutch Minister of Finance, Wopke Hoekstra, said the ministry does not aim to ban cryptocurrencies but will regulate them. Then, in April, the AFM warned against investments in cryptocurrency and ICOs. Nevertheless, Dutch investors continue buying Bitcoin, even though the majority of its ordinary citizens remain uninterested.
The bank’s approach is not as radical as the Indian central bank’s one which banned crypto or the Finnish one which called crypto “fallacy” but is still quite tough. Other central banks, like the Norwegian and Swedish ones, are more open-minded. The Norwegian bank is even considering launching its very own digital currency.