A new European Central Bank (ECB) report claims that Bitcoin BTC/USD leads to wealth moving from late adopters to early investors.
Summary: The report, titled “The distributional consequences of Bitcoin,” argues that only early adopters benefit from rising Bitcoin prices, while latecomers and non-holders suffer. Authors Ulrich Bindseil and Jürgen Schaaf believe Bitcoin has shifted from a payment system to an investment asset.
The economists point out that Bitcoin lacks cash flow, interest, or dividends, making typical valuation methods useless. They suggest this creates a zero-sum game where only early investors gain, harming the rest of society.
The report encourages non-holders to oppose Bitcoin and seek regulations against it, as it is viewed as a tool for financial redistribution at their expense.
Critics, including Bitcoin analyst Tuur Demeester, have denounced the report as excessive, with investor Marc van der Chijs warning of increasing hostility towards Bitcoin holders in Europe.
Importance: The ECB has criticized Bitcoin before, stating its fair value is “still zero” and its transactions are slow and costly. This aligns with recent regulatory changes in Europe, including higher capital gains taxes in Italy and proposed exit taxes in the Netherlands.
Related Read: In 2022, Bitcoin ‘Helped To Humble’ Anthony Pompliano: A Look At How His Price Predictions Have Evolved
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