Federal Reserve Chairman Jerome Powell rejected the idea that Bitcoin could replace the U.S. currency, and instead framed the crypto-currency as a speculation asset similar to gold.
Powell spoke at The New York Times DealBook Summit on Manhattan. He stressed Bitcoin’s limited usage as a store of value or a means of payment.
Powell, Powell.
“It’s just like gold, only it’s virtual… It’s very volatile, it’s not a competitor for the dollar, it’s really a competitor for gold. That’s how I think of it.”
Powell’s remarks come in the midst of increased speculation regarding Bitcoin’s increasing influence on global finance. Crypto recently achieved a market capitalization of $1.92 trillion, surpassing silver, valued at $1.75 trillion, to become the world’s eighth most valuable asset. It is still far behind the estimated value of gold at $18 trillion.
Powell’s comparison of Bitcoin to the dollar is not new. By 2021, Powell will become the Fed chairman The following are some of the ways to get in touch with each other Crypto isn’t a good store of value because it has a high volatility. Bitcoin, for example, is volatile. “essentially a substitute for gold, rather than for the dollar.”
Under President Joe Biden’s administration, the Fed is accused of being pivotal in Operation Chokepoint 2.0, an alleged plan to hinder the progress of the US crypto industry.
Tyler Winklevoss of Gemini stated, in August, that the initiative would be implemented following a Fed order directed to crypto-friendly Customers Bank. The Fed had urged stricter risk management measures and compliance. “is alive and well.”
DeFi is a ally
Despite Powell’s conservative tone toward Bitcoin and crypto as an asset class, Fed Governor Christopher J. Waller Recently praised DeFi, as an ally.
Waller stated at the Vienna Macroeconomics Workshop, held on October 18, that financial intermediaries remain fundamental. But he did acknowledge that DeFi technologies offer an efficient alternative to conventional financial instruments.
He acknowledged the benefits of Distributed Ledger Technology (DLT), tokenization and smart contracts that can improve the speed and accuracy in financial transactions.
Waller You can also recognize this by The Clearing House Annual Conference 2020 on November 12 questioned whether CBDCs (central bank digital currency) could help solve the payment system’s problems.
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