Cryptocurrency boom in Lithuania has European banks worried

The Baltic nation is threatening to become Europe’s cryptocurrency powerhouse, leading to concerns by European central banks that it could disrupt financial systems and even fuel illegal activity. Lithuania boasts of a crypto friendly ecosystem having generated over half a billion euros in ICOs and other blockchain based businesses.

Regardless of the volatile nature of cryptocurrencies, it is fast become a payment option throughout the country and also a viable investment tool for thousands of investors. A source of worry for European Banks and regulators however, is that digital units can conceal money laundering activities by criminals.

Mark Carney, Governor of the Bank of England, further raised voices in this respect by calling for a crackdown on cryptocurrencies because it can fuel “illegal activities and disrupt the traditional financial system.”

Lithuania’s crypto market is free of regulations by any commission meaning that start-ups are less accountable to investors and also fraudulent projects could raise a great fortune from investors. Even though that has not stunted the growth of the industry, a loophole as stated by Bank of Lithuania board member Marius Jurgilas is that Russian investors have a chance of flooding the ICO market.

“We don’t want Russian capital infiltrating into the local economy. We are constantly reminding everyone about the risks – ‘I don’t want to see 70 percent of your investors in your ICO coming from Russia. An influx of non-transparent capital from Russia is not in line with our national interests.”

Amidst the fear, scalable blockchain projects have won the heart of many sectors in the country and undoubtedly have a chance to lift the nation’s economy.

Lithuania is on the Rise with Crypto!

Data from the European Commission has revealed that the Lithuanian economy is expected to grow by 3.1% due to the growing adoption of digital coins, a figure that tops the average value for other countries in the EU by 0.8%.

Lithuanian MEP Antennas Guoga has in the past asserted that the country is “still far behind Western Europe” economically, but that story may soon change.