The soon-to-be president of the European Central Bank (ECB) has a record of respecting the potential in crypto.
Christine Lagarde, a French lawyer and the current managing director of the International Monetary Fund, has indicated her support for crypto companies such as Ripple and Circle.
At the Paris Fintech Festival earlier this year, Lagarde, who will be the first female ECB president, warned banks that they need to act and adapt to new technologies to better serve their customers.
“I think in the banking system at large in many, many countries, the difference will not be between those who are disrupted and those who survive. The difference will be between those who are cannibalized because they’re not seeing it coming, and they’re not embracing it, and those who self-induce that cannibalization.
And I’m using cannibalization on purpose because it’s a bit of a striking, horrible word. But it’s really what it means. You’re going to disrupt your business model. You’re going to change it. You’re going to reduce your costs. You’re going to expedite your transactions, and you’re going to inspire confidence because you will build out on the basis of an existing backbone, which is your bank and the confidence, relationship you’ve established with your customers.
So that’s where I see changes happening now.
If you think of Circle, and Ripple and all those – that’s where they are active and helpful.”
Lagarde has also warned that these cryptocurrencies “shaking the system” require regulations in order to maintain stability in the financial industry, reports CNBC.
“I think the role of the disruptors and anything that is using distributed ledger technology, whether you call it crypto, assets, currencies, or whatever … that is clearly shaking the system.”
“We don’t want innovation that would shake the system so much that we would lose the stability that is needed.”
Lagarde will replace Mario Draghi as president of the ECB on November 1. Selected by representatives of 28 European countries, Lagarde is tasked with controlling inflation and enforcing monetary policy decisions.