Netherlands must ban cryptocurrencies immediately: CPB head

The cabinet must ban bitcoin and other cryptocurrencies, head of central planning office CPB, Pieter Hasekamp said in Het Financieele Dagblad. He believes that a crash of cryptocurrencies is unavoidable and that the Netherlands should act as soon as possible.

"For investors and the governments alike, the last person to act is the loser. The Netherlands must now ban bitcoin," Hasekamp wrote in an essay published in the newspaper.

Hasekamp stated that several countries took steps to curb cryptocurrencies, citing fraud, criminal use, and financial instability. According to him, The Netherlands is lagging behind. Attempts have been made to tighten up the supervision of trading platforms but without much success.

The CPB director advocated for the ban on the production, trade and possession of crypto coins. In practice, this would be difficult to enforce since cryptocurrencies are not issued by financial institutions. Moreover, they are traded internationally and authorities generally have little control over them due to their decentralized nature. Minister of Finance Wopke Hoekstra also rejected a ban on cryptocurrencies in 2018.

Hasekamp explained that the ban would automatically lead to a decline in the value of cryptocurrencies. According to him, cryptocurrencies are used because people think they will one day replace traditional money, which is not going to happen.

"Cryptocurrencies are essentially neither money nor a financial product, but an example of what Nobel laureate Robert Shiller calls a 'contagious narrative': a contagious story in which people believe because other people believe in it."

El Salvador became the first country to adopt a cryptocurrency for everyday use, after its president said on Wednesday that Bitcoin will become legal tender.