Gabriel Makhlouf, Governor of the Central Bank of Ireland, said that cryptocurrencies pose risks that need to be protected for consumers and investors, by comparing cryptocurrencies to a pyramid scheme rather than an investment.
Irish Central Bank Governor Makhlouf Compares Cryptocurrencies to Ponzi schemes
The EU passed legislation setting crypto regulations in April. Makhlouf called for rules to protect investors and consumers.
In a blog post, Makhlouf said there was an "urgent need for policy action" that protects investors and consumers across the European Union through "rigorous" regulation and welcomed new EU rules aimed at starting to do so.
The remarks added to criticism of the crypto market from central banks around the world, with the US Federal Reserve, Bank of England, and the European Central Bank expressing concerns about the risks from digital currency trading leaking into the wider financial system.
BOE Vice President Jon Cunliffe stated that cryptocurrency is as dangerous as the mortgage market that triggered the global financial crisis more than a decade ago.
European lawmakers passed ambitious legislation last month that would introduce rules to the European Union to govern the crypto industry.
The EU's green light for Crypto Asset Markets, or MiCA regulation, marks the first time governments have attempted to regulate the nascent industry at this scale and followed the collapse of several major players, including crypto exchange FTX.
*Not investment advice.