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European Central Bank head reveals CBDCs could be used for ‘control’ amid banking crisis

European Central Bank head reveals CBDCs could be used for 'control' amid banking crisis

In a widely shared prank video, Christine Lagarde, the president of the European Central Bank (ECB), has admitted that a digital euro, a central bank digital currency (CBDC) that is currently planned for release in the near future, would be used in a ‘limited’ way to control the payments that individuals can make.

The clip, in which Lagarde is led to believe she is talking to the Ukrainian President Volodymyr Zelensky, originates from a video platform Rumble channel Show VL, in which the authors prank-interview public figures, and was first shared on March 16.

‘There will be control’

Discussing the active backlash in Europe over the possible introduction of the digital euro, the person pretending to be Zelensky suggested that “the problem is they don’t want to be controlled” by a CBDC, to which Lagarde acknowledged that “there will be control, you’re right. You’re completely right,” but specifying it would be a “limited amount of control.”

As she explained:

“We are considering whether for very small amounts, anything that is around €300, €400, we could have a mechanism where there is zero control.”

However, she also said “that could be dangerous,” as very small, totally anonymous transactions could still, and had been known to finance terrorist attacks entirely, such as ten years ago in France. 

As an argument for a CBDC, Lagarde voiced her desire for Europe not to be dependent on an “unfriendly country’s currency,” such as the Chinese or Russian currencies, or “a friendly currency but which is activated by a private corporate entity like Facebook or Google,” that could “take over the sovereignty of Europe.”

CBDCs vs. crypto

It should also be noted that Lagarde has been concerned about the growth of cryptocurrencies and their threat to the traditional banking system, claiming in September 2022 that the rise of crypto assets could hinder the role of central banks as an ‘anchor’ of the economy, as well as demanding greater oversight over the crypto industry, and the assets she said were “worth nothing.”

More recently, in February 2023, Finbold reported on the progress of the ECB’s plans around the digital euro introduction, which prioritize e-commerce and person-to-person payments during the first phase of the CBDC release, followed by other contexts, such as physical stores and government payments, in the second phase.

Meanwhile, speculation has been mounting that the banking crisis in the United States was a ploy with an aim to accelerate the adoption of CBDCs, as Nic Carter, the General Partner at Castle Island Ventures, said that the recent turmoil strengthened “the political case for CBDCs,” as “no one trusts commercial banks” anymore.

Watch the entire video below:

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