A Dutch official argued that the Netherlands should ban Bitcoin mining, trading and holding, as it fulfills none of the three functions of money and is useful to criminals. While El Salvador legally accepts Bitcoin, a Dutch official has called for an immediate general ban on cryptocurrencies.
Pieter Hasekamp, director of the Dutch Bureau of Economic Analysis within the Ministry of Economic Affairs and Climate Policy, published an article titled “The Netherlands should ban Bitcoin.”
In keeping with the title of the article, Hasekamp cites an extensive list of reasons why the Dutch government should immediately impose a complete ban on Bitcoin (BTC) mining, trading and holding. According to the official, this could cause the price to drop because Bitcoin “has no real value and is only valuable because others can accept it.”
The executive referred to a common anti-crypto narrative, arguing that any cryptocurrency cannot fulfill any of the three functions of money as a unit of account, a means of payment, and a store of value. He also cited other common anti-Bitcoin arguments such as security concerns, fraud and scam risks, and argued that crypto is a useful tool for criminal actors.
Hasekamp said the Netherlands has lagged behind countries that have moved to “curb the crypto hype” in recent years.
“Dutch regulators tried to tighten control of trading platforms, but without much success. The Central Planning Bureau drew attention to the risks of crypto trading in 2018, but concluded that stricter regulation is not yet necessary.”
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In his article, Hasekamp cited Gresham’s law, a monetary principle that states that overvalued currency or “bad money” tends to legally drive an undervalued currency or “good money” out of circulation. Calling Bitcoin “bad money”, Hasekamp argued that Gresham’s law could work with Bitcoin in the opposite way:
“Cryptocurrencies show all the characteristics of ‘bad money’: uncertain origin, uncertain valuation, shady trading practices. […] Has Gresham’s law come back? No, on the contrary. Cryptocurrency is not used in normal payment transactions. […] Bad money is going out of circulation because no one wants to accept it anymore.”