This share prices have a 15 minute delay and are shown in the local time of the market in which the quote is displayed.
Crypto Economy - A New Social Model?
The Centre for the Governance of Change del IE has released a report assessing the social value of the Crypto assets, meaning their contribution to the broader economy and society, reaching the conclusion that they do not add substantive social value or benefits to our societies beyond private gains and general benefits to market activity. The report considers that this conclusion does not mean that it cannot do so in the future and advocates for further research in this field.
Main conclusions of the Report:
- Crypto assets are gaining relevance over the last years, reaching a market capitalisation of $3 trillion by the end of 2021.
- The main supporters of crypto asset’s social value provide the following arguments:
- Growing interdependence with the real economy and partial replacement of some systems of the financial and economic model has made them irreplaceable and, therefore, their long-term sustainability inevitable.
- By reducing the need for intermediaries, the crypto economy enables financial inclusion and is democratizing the financial sector, while increasing the efficiency of financial markets.
- Critics, on the other hand, consider that:
- Cryptocurrencies are a speculative bubble driven by those seeking to circumvent the system to finance criminal activities or avoid paying taxes.
- The crypto economy tends to attract less experienced and therefore more vulnerable investors.
- Environmental concerns and the belief that the increasing prevalence of crypto assets will lead to further financialization of the economy.
- The report finds that decentralization is not happening to the extent that crypto advocates argue and, consequently, there is a gap in the democratization discourse around crypto where there has been concentration of power in many areas, for example:
- Only 1% of cryptocurrency users are institutional investors, but that they generate 60% of the operations and own 50% of the assets in circulation.
- In the case of Bitcoin, a study from the National Bureau of Economic Research (NBER) shows that 0.01% of crypto-asset holders control 27% of the Bitcoins in circulation.
Filter results
According to Kristalina Georgeva IMF Managing Director, lifting growth requires three things: one, regulatory housecleaning to unleash private enterprise; two, deeper regional integration; and three, preparedness to harness AI.
According to The European House – Ambrosetti, the European Union has an opportunity to boost competitiveness and growth by simplifying regulatory and supervisory frameworks, particularly in the areas of sustainability and the financial sector.
According to Ramón Casilda Béjar, Spain, in today’s complex geopolitical landscape, has the opportunity to strengthen its role as a bridge and connecting country between Ibero-America and the European Union, revitalizing investment flows in both directions.
According to @ECB, in moments of acute stress, the public often turns to physical currency as a reliable store of value and a resilient means of payment, underscoring the crucial role it plays above and beyond everyday transactional convenience
According to Juan S. Mora-Sanguinetti, in Spain a 10% increase in regulatory volume leads to a 0.5% drop in employment in companies with fewer than 10 employees.
According to Hélène Rey “In a world where stablecoins, particularly those pegged to the dollar, become an important global payment tool, we must brace ourselves for substantial consequences”.
@judith_arnal proposes reforms for the EU to advance regulatory simplification, starting with consensus on its meaning, with competitiveness as a pillar, plus coordination mechanisms and a governance rethink.
According to @iee_org, Spain has one of the most demanding tax environments for businesses within the European and international context, which may have significant implications for competitiveness, foreign investment attraction, and business expansion.
According to Christine Lagarde for the euro to gain in status, Europe must take decisive steps by completing the single market, reducing regulatory burdens and building a robust capital markets union.
According to the Bank of Spain, in a context of strong growth in transactions and prices, the conditions under which new mortgage loans are granted currently show no signs of easing in lending standards.
McKinsey notes that European private capital is half the size of the U.S. and must play a key role in boosting competitiveness, by driving innovation, scaling firms, and mobilizing the investment needed to close the gap with other regions.
IMF states that global financial stability risks have grown significantly, driven by tighter financial conditions and heightened trade and geopolitical uncertainty.