The European Central Bank in May 2019 released a report that speaks of the implications of cryptoassets with respect to financial stability, monetary policy, and payments and market structures. In it, it considers Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), and Bitcoin Cash (BCH) as being the most important in terms of usage.
The report attempts to form a definition for cryptoassets, the developments in the space, and the impact it could have in the current global economy. It begins with defining cryptoassets as follows,
A crypto-asset is defined as a new type of asset recorded in digital form and enabled by the use of cryptography that is not and does not represent a financial claim on, or a liability of, any identifiable entity.
Calling the market capitalization “modest”, it notes that the market cap is a fraction of other existing markets – and then goes on to say that out of the nearly 2000 cryptoassets that exist, Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), and Bitcoin Cash (BCH) are the most important in terms of usage, market cap, or business model diversity.
In the latter half of the document, the ECB states that cryptoassets, “do not fulfill the functions of money and neither do they entail a tangible impact on the real economy nor have significant implications for monetary policy.”
It concludes by saying that, while it does not pose a risk in the current state, the market requires monitoring and the cooperation of authorities to prepare for adverse scenarios.
