ECB policymaker Fabio Panetta expressed concerns on Friday about the potential reputational risks banks may encounter by offering crypto-related services. These remarks come in the wake of an increasing engagement of traditional financial institutions with digital assets.
In January, Intesa Sanpaolo, the largest bank in Italy, embarked on what its CEO Carlo Messina called “an experiment”, purchasing digital assets worth 1 million euros in Bitcoin, the leading cryptocurrency. The bank had established a proprietary trading desk for digital currencies in 2023, and began facilitating spot trades with crypto assets last year.
However, Panetta expressed worries that those who hold crypto assets may not completely comprehend their nature, potentially mistaking them for conventional banking products. He warned that such misconceptions could lead to negative impacts on the trust in the credit system, especially if losses occur.
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