10 years working with the ECB on the future of finance. The European Central Bank (ECB) has demonstrably misjudged the trajectory of Bitcoin, consistently underestimating its resilience and growth. Their pronouncements, such as calling Bitcoin "on a road to irrelevance" in 2022 when it was trading around $16,000, stand in stark contrast to its subsequent surge, reaching $112,000 by May 2025. This persistent skepticism, reiterated through various "greatest hits" – labeling it "unsuitable for payments or investment" in 2024 and Christine Lagarde's concerns about its volatility in 2025 – has blinded the ECB to Bitcoin's actual performance. Over the past decade, Bitcoin has yielded an astounding 26,931% return, outperforming every traditional asset class.
The ECB's stance has been characterized by a significant cognitive dissonance, predicting Bitcoin's "death" at every milestone, from dismissing it as a "speculative bubble" at $20,000 to remaining silent as it surpassed $100,000. Each negative forecast has been thoroughly discredited by market realities and burgeoning adoption. While the ECB debated its legitimacy, global crypto adoption has soared, with over 500 million people now holding digital assets. Furthermore, nations have begun adopting cryptocurrencies as legal tender, and blockchain technology is revolutionizing remittances by drastically cutting costs. This rigid adherence to outdated perspectives has arguably led to Europe missing out on a significant payment revolution.
The geopolitical ramifications of this misguided stance are becoming increasingly apparent. As the ECB continues to issue papers on Bitcoin's perceived flaws, other major global players are strategically embracing it. The United States has announced a Strategic Bitcoin Reserve, states like Pennsylvania are proposing their own reserves, and major corporations are adding Bitcoin to their balance sheets. This stark contrast highlights Europe's hesitant approach, which risks marginalizing it in the evolving digital asset landscape. It's particularly ironic that the ECB voices concerns about Bitcoin's risks while simultaneously witnessing the collapse of traditional European banks (e.g., Credit Suisse) and persistent inflation eroding purchasing power – a stark contrast to the fortunes of many Bitcoin holders.
The regulatory contradiction further underscores the ECB's inconsistent position. Despite the EU's own MiCA regulation creating a legal framework for digital assets and shifts in US policy removing institutional barriers, the ECB has maintained that "regulation doesn't legitimize Bitcoin." This creates a paradox where Europe is actively shaping the regulatory environment for digital assets while its central bank appears reluctant to acknowledge the implications of its own legislative efforts. The Czech National Bank, in exploring Bitcoin reserves, exemplifies an institution that recognizes the future potential, contrasting sharply with the ECB's seemingly backward-looking approach.
This consistent misjudgment represents a significant missed opportunity for Europe.
However, while the ECB rightfully expresses doubts about some of Bitcoin's utility, particularly its volatility for everyday payments, it has never been fundamentally against the broader concept of blockchain itself. Indeed, the ECB is actively embracing and exploring the potential of stablecoins, recognizing their role in future payment systems and financial innovation. The institution's skepticism towards Bitcoin should not be conflated with a blanket rejection of all digital assets; rather, it highlights a selective caution that, in the case of Bitcoin, has proven to be economically short-sighted.
Once the US clarifies its regulatory scheme the E.U. has to react. Will it do the right thing?