Bitcoin’s soaring value has prompted an urgent BTC warning from the EU Central Bank. Economists fear potential societal impacts as the cryptocurrency shifts from a payment system to an investment asset.
EU Central Bank’s Urgent BTC Warning: What It Means for Investors
Wealth Inequality Concerns
ECB economists Ulrich Bindseil and Jürgen Schaaf argue that BTC’s increasing value mainly benefits early adopters, potentially worsening wealth inequality.
“In absolute terms, early adopters exactly increase their real wealth and consumption at the expense of the real wealth and consumption of those who do not hold Bitcoin or who invest in it only at a later stage,” they wrote.
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Societal Stability Risks
The economists warn that BTC’s rise could threaten social cohesion and stability.
“The consequences of the Bitcoin-as-an-investment vision with perpetually increasing Bitcoin prices imply a corresponding impoverishment of the rest of society, endangering cohesion, stability and ultimately democracy,” they argued.
Call for Regulation
The ECB economists advocate for strict price controls on Bitcoin to address these risks. They urge non-holders to oppose BTC and support legislation to curb its price increase.
“Latecomers and non-holders and their political representatives should emphasize that the idea of Bitcoin as an investment relies on redistribution at their expense. Failing to do so could skew election results in favour of politicians who advocate pro-Bitcoin policies, implying wealth redistribution and fuelling the division of society,” they concluded.
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Crypto Community Pushback
The ECB’s stance has drawn criticism from industry experts. Market analyst Tuur Demeester warns that the document may empower governments to impose stringent taxes and restrictions on cryptocurrency.
“Many of us have warned that this was coming: Bitcoin as a major political fault line both in national and international elections. Well here it is. It means that us HODLers must take action to insure that governments respect our basic right to hold property,” Demeester warned.
Marc van der Chijs, co-founder of Hut 8, expressed similar concerns:
“If Bitcoin should double or triple in 2025 I would not be surprised to see more politicians turning against BTC and trying to tax it excessively,” Van der Chijs claimed.
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Bitcoin Price Predictions
Despite the warnings, BTC’s price is expected to rise. CoinCodex predicts:
“According to our current Bitcoin price prediction, the price of Bitcoin is predicted to rise by 51.45% and reach $ 104,343 by December 30, 2025. Per our technical indicators, the current sentiment is Bullish while the Fear & Greed Index is showing 72 (Greed). Bitcoin recorded 16/30 (53%) green days with 3.54% price volatility over the last 30 days. Based on the Bitcoin forecast, it’s now a good time to buy Bitcoin.”
Telegaon’s forecast is even more optimistic:
“Bitcoin may hit a new ATH in 2025 due to community and institutional investment. The average price prediction for BTC in 2025 is $109,646.04, with a maximum of $125,360.85. The minimum price could be around $97,078.79. If the market turns bullish, Bitcoin may surge beyond these predictions.”
