Cutting through the noise: exercising good judgment in a world of change
· Christine Lagarde, President of the European Central Bank (Euro area (EU))
Summary written by Dark Majestic in its own words · topics: payments, digital money and crypto-assets
CL · Christine Lagarde Wiki · European Central Bank WikiCutting through the noise: exercising good judgment in a world of changeContextWelcome address by Christine Lagarde, also Chair of the European Systemic Risk Board, at the ninth annual ESRB conference.
Why it mattersLagarde compares stablecoins and some funds to past run-prone instruments, stressing liquidity rules and MiCAR enforcement.
Problems raised- New instruments bring back old risks.
- Funds promise redemption at par while holding risky assets.
- Stablecoins carry run risk.
Solutions proposed- Require enough liquidity to meet redemptions.
- Watch money market funds closely.
- Apply MiCAR rules to stablecoins.
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