Cryptocurrencies? Ok, but issued by states. Savona (Consob) wakes up the Bank of Italy?

by Marco Dell’Aguzzo

For the president of Consob, Paolo Savona, "money can only be public", while cryptocurrencies represent a risk for savings. On the other hand, he does not reject blockchain technology, but invites to regulate it

"Money can only be public, that is, issued by sovereign states". This was stated by Paolo Savona, president of the National Commission for Companies and the Stock Exchange (Consob), in an interview with the newspaper La Verità.


In short, Savona's is a firm no to cryptocurrencies such as bitcoins. While his position on the blockchain, the technology underlying their operation, is more nuanced: in his last annual speech to the financial market, the Consob president had in fact insisted on the need for a regulation that allows the authorities to supervise its use.


In the interview with Truth, Savona returns to his "diagnosis" on the blockchain, and explains why it represents both "an opening" and "a closure" to technology.

It is an opening, you said, "because the Genius has come out of the computer lamp, you cannot bring it back in and therefore we need to find a form of coexistence at the regulatory level. History teaches that technological innovations are always hindered, but they end up imposing themselves, especially if they bring benefits ".

But this is also a closure “because if innovations are used to create private currencies, cryptocurrencies, I have declared myself against it on the basis of scientific arguments. Money can only be public, i.e. issued by sovereign states, if you want to enjoy the benefits of being a reservoir of stable values and debt-freeing tools protected by law ”.


"It has been said that it is not the task of CONSOB, much less the president, to underline these monetary aspects of finance," Savona told La Verità. He does not agree with this reconstruction, however: he said on the contrary that "soliciting the solution of the cryptocurrency problem" is the responsibility of CONSOB because "the debt securities over which the authorities supervise are denominated in a sovereign currency in order to benefit from the legal protection ".


Savona thinks cryptocurrency speculation is comparable to subprime mortgage speculation in the US, which led to the 2007 crisis (the so-called "Great Recession").

He therefore believes that they have become a threat to savers, who, having increased their saving capacities in the months of the pandemic, could be attracted to the "sirens" of cryptocurrencies: bitcoins are the most famous, but there are thousands of different ones.

For Savona, the framework for the protection of savings "appears worrying", citing - in his recent speech to the market - "the experience made in a short time by Consob in obscuring hundreds of websites in Italy that illegally collected savings".

"The 'warnings' addressed to investors about the risks they run by operating in cryptocurrency are no longer enough", he said; “The time for reflections has now run out and we must move on to choices”.


On that occasion, Savona spoke of information security as the "open side" of the new digital finance, which should be considered "a public good".

In the interview with La Verità he returned to this point to declare that the newly created National Cybersecurity Agency "certainly" represents a turning point, "especially for digital finance": "after decades of waiting and the emergence of risky geopolitical disputes on the subject , Italy has decided to set up an ad hoc structure ".


In this new context, Savona told the Truth to think that "without a legal definition of what money is in the infosphere, the sphere where the IT genius operates, it is not clear what the roles of banks currently are and who and how authorities supervise financial products ”.

Savona does not believe that banks should not manage payment systems, but he argues “that their role in the monetary circuit changes. If we switch to public cryptocurrencies, such as the crypto euro (or Cbdc), the banks will manage the wallet-deposits, whose stability would be guaranteed by the monetary authorities and bank deposits would no longer run credit-related risks ".

Savona proposes to "make asset management more profitable, giving it more objective characteristics such as those offered by artificial intelligence".

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