Coinbase CEO and French central bank chief clash over Bitcoin and stablecoins

Source: PortaldoBitcoin Original Title: Coinbase CEO and French Central Bank Chief Clash Over Bitcoin and Stablecoins Original Link: A panel at the World Economic Forum in Davos brought together Brian Armstrong, CEO of a cryptocurrency platform, and François Villeroy de Galhau, President of the French Central Bank, in a debate that exposed deep disagreements about the future of money, the role of cryptocurrencies, and the limits of monetary sovereignty.

The discussion gained prominence when Armstrong stated that the world was witnessing the emergence of a new monetary regime. “We are seeing the birth of a new monetary system that I would call the Bitcoin standard, instead of the gold standard,” the executive said, presenting Bitcoin as an alternative amid the devaluation of fiat currencies.

Villeroy directly rejected this premise. For the French leader, money and monetary policy are inseparable from democratic sovereignty. “Monetary policy and money are part of sovereignty,” he said. “We live in democracies,” he added, arguing that decisions about the monetary system should remain under institutional control.

The tone of the debate escalated when Villeroy attempted to counter the trust and responsibility associated with central banks with what he called private issuers of Bitcoin. “The guarantee of trust is the independence of the central bank,” he said, adding that he trusts more in “independent central banks with a democratic mandate” than in “private issuers of bitcoin.”

Armstrong immediately corrected him. “Bitcoin is a decentralized protocol. In fact, there is no issuer,” he stated. Then he took the argument further: “In the sense that central banks have independence, Bitcoin is even more independent. There is no country, company, or individual that controls it in the world.”

Despite the correction, Villeroy maintained his critical stance towards cryptocurrencies. “Innovation without regulation can create serious trust issues,” he said. For him, “the first threat is the privatization of money and the loss of sovereignty,” warning that if private currencies dominate, countries could become dependent on foreign issuers.

The disagreement extended to the topic of stablecoins and the possibility of paying interest. Armstrong argued that this type of remuneration would benefit users and increase international competitiveness. “First, this puts more money in consumers’ pockets. People should be able to earn more with their own money,” he said. Then he highlighted the global scenario: “China has already said that its digital central bank currency will pay interest, and offshore stablecoins already exist. If regulated stablecoins in the US are banned from paying rewards, offshore competitors thrive.”

Villeroy again took a contrary position, classifying private tokens that pay interest as a systemic risk to the traditional banking system. He also rejected the idea that digital currencies issued by central banks should compete in profitability. When asked about a digital euro with interest, he was categorical: “The answer is no.” According to him, “the public purpose should also be to preserve the stability of the financial system.”