TLDR
- Governor of the Bank of France François Villeroy de Galhau criticizes Trump’s crypto policies as “sowing seeds of future upheavals”
- Villeroy de Galhau warns that the US risks causing another global financial crisis through crypto deregulation
- Trump administration has created a crypto strategic reserve to stockpile Bitcoin and Ethereum
- The SEC has dropped major cases against crypto exchanges under Trump
- French central banker labels current US deregulation wave as “dangerous”
François Villeroy de Galhau, Governor of the Bank of France and member of the European Central Bank Governing Council, has issued a stark warning about the Trump administration’s approach to cryptocurrency regulation. The central banker believes the United States is making a grave error by embracing digital assets.
In a recent interview with French weekly La Tribune Dimanche, Villeroy de Galhau expressed concern that the US might be setting the stage for the next global financial crisis. He pointed to the administration’s supportive stance on cryptocurrencies as a major risk factor.
“The United States risks sinning through negligence,” the French central banker stated. He added that “Financial crises often originate in the United States and spread to the rest of the world.”
Sowing the seeds of future upheavals
Villeroy de Galhau specifically called out the American approach to digital assets. “By encouraging crypto-assets and non-bank finance, the American administration is sowing the seeds of future upheavals,” he warned.
The Bank of France governor reminded readers that three of the five biggest financial crises emerged from the United States. These include The Great Depression following the 1929 Wall Street crash, the 1973 OPEC Oil Price Shock, and the Great Recession triggered by the collapse of the US housing market.
This is not the first time Villeroy de Galhau has voiced concerns about Trump’s financial policies. Even before Trump’s January inauguration, he expressed worry about American regulatory approaches.
On January 15, he stated, “I believe that what we sometimes hear in the United States about the lack of regulation of non-banks, the various funds or the lack of regulation of crypto-assets is something that would put financial stability at risk.”
“Tragedy for the American economy”
The central banker’s criticism extends beyond crypto to Trump’s broader economic approach. Earlier this week, he described Trump’s trade wars and economic policy as a “tragedy for the American economy.”
Villeroy de Galhau is not alone in his criticism. German central bank chief Joachim Nagel has also spoken out, calling Trump’s economic policy “economic policy from a horror show.”
Since Trump returned to office, there has been a clear shift in how the US government approaches digital assets. The Securities and Exchange Commission has dropped major cases against crypto exchanges, including Coinbase.
The Trump administration has also established a crypto strategic reserve. This program aims to stockpile tokens like Bitcoin and Ethereum as national assets.
These moves mark a sharp contrast from previous US approaches to cryptocurrency regulation. Under the Biden administration, regulators took a more cautious stance toward the crypto industry.
“American deregulation is dangerous”
Villeroy de Galhau sees these changes as part of a broader pattern. He believes that the “current wave of American deregulation is dangerous” for global financial stability.
The French banker also contrasted European and American economic positions. In his La Tribune Dimanche interview, he suggested that “It is better to be European than American today” in terms of economic outlook.
He views the current trade tensions as an opportunity for Europe to strengthen its position. “We must not respond to this brutality with passivity or inevitability, but with will,” he stated regarding Trump’s trade policies.
Villeroy de Galhau advised that Europe needs to “establish a balance of power” in trade negotiations with the US. However, he emphasized that Europeans should use this moment to strengthen their economic union.
For France specifically, the central banker stressed the importance of reducing the national deficit to improve its economic standing. He sees fiscal discipline as key to weathering potential financial storms.
These warnings come as cryptocurrency markets continue to experience growth following Trump’s election. Many crypto investors have welcomed the administration’s more friendly approach to digital assets.
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