• The Eurozone is experiencing financial fragility due to the mounting debt of Germany and other member states.
• The ECB has engaged in excessive money printing, resulting in inflation and market-to-market losses of 700 billion euros.
• With high interest rates remaining, governments may need to make additional payments to prevent the collapse of the euro.
Growing Financial Fragility in Eurozone
The Eurozone financial fragility is growing with economic giant Germany accumulating debts of 1.0687 trillion euros and more. If the Euro crumbles under its own weight, a faster Bitcoin and crypto adoption is likely in the Eurozone. The euro has existed as an official currency for only 21 years following its monetary union in 2002, but its fate was already uncertain even then.
ECB’s Money Printing Program
In response to this, then ECB President Mario Draghi announced that they would defend the common currency “using all available means”. This included implementing a bond purchase program which injected a total of EUR 8.828 trillion into circulation at its peak. After some time, inflation started to gain momentum so the ECB discontinued bond purchases and reduced their total assets as maturing bonds were not replaced with new ones. This resulted in market-to-market losses amounting up to 700 billion euros over the past year alone according to Alasdair Macleod – nearly six times higher than the equity deposited within the Eurosystem.
High Interest Rates
The ECB increased interest rates in order to combat inflation but this led to government bonds yielding higher values which further decreased their value resulting in more losses for markets overall. With interests remaining this high and yields continuing to rise, it would be hard for them to reach their target inflation rate of 2 percent making them unable to avert a potential collapse by themselves without extra payments from member states like German who still remains committed towards defending it or not?
Risk Of Collapse
If members don’t decide on making these extra payments then there is a risk that euro might fall apart leading countries back into recession again with worsened unemployment rates and lack of economic stability as well as confidence amongst citizens throughout Europe regarding their currency among other issues if something drastic isn’t done about it soon enough!
Therefore it is essential for governments across eurozone member states including Germany take decisive action now before situation worsens further resulting into more losses both financially as well as politically speaking – potentially leading into extinction for euro altogether! In any case investors should better bet on Bitcoin and Ripple (XRP) for future growth prospects if worst comes true eventually!