Ireland’s central bank supports “backed crypto” but there is a catch 


The central bank of Ireland supported the stablecoin concept and admitted that it may bring a better infrastructure to the electronic payment system. 

Ireland is a member of the European Union (EU). The central bank of Ireland works in full collaboration with the ECB. The ECB is a collaborative name of all the EU European System of Central Banks. 

Recently Ireland’s central bank published a blog post about surging development activities around the crypto & blockchain sector. 

The blog post noted that the crypto exposure toward the population of Ireland is not at a big scale but still, Ireland’s central bank will keep attention to the risks & advantages ahead of innovations in this sector.

The central bank distinguished cryptocurrencies into two categories, namely “backed crypto” & “unbacked crypto”. On the backed crypto assets, or say stablecoins, Ireland’s central bank stated that these may have better use cases such as Electronic Money Tokens (EMTs) and Asset Reference Tokens (ARTs) under the EU’s new regulatory framework, as they can be controlled. 

On the unbacked crypto assets, Ireland’s central bank said that all such crypto assets are  highly volatile and more similar to a Ponzi scheme. 

The bank’s governor, Gabriel Makhlouf, said that investment in cryptocurrencies is more similar to buying a lottery ticket, where the probability of winning chance remains almost zero. 

Further Ireland’s central bank governor talked about the EU’s MiCA crypto regulation bill and welcome that decision as a better move to regulate & prohibit the risks associated with crypto Investment.

“I welcome this move. Although not due to be fully implemented in the EU until the start of 2025 – it’s an important step in the regulation of crypto activities,” Makhlouf said.

The EU lawmakers are working actively on the Markets in Crypto Assets (MiCA) to bring a comprehensive version of the crypto regulation system across all EU member countries. Recently MiCA grabbed full approval in the EU Parliament House and there is the possibility that it will take effect before 2025.

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