Kevin Helms
A student of Austrian economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open source systems, network effects and the intersection of economics and cryptography.
Federal Reserve Bank President Says “The Whole Concept of Crypto Is Bullshit” – Regulation Bitcoin News
The president of the Federal Reserve Bank of Minneapolis, Neel Kashkari, says that the crypto exchange FTX is not “a fraudulent company in a serious industry”. The Fed president claimed that “The whole concept of crypto is bullshit,” claiming it was “just a tool for speculation and bigger idiots.”
Minneapolis Fed President Neel Kashkari on Crypto and FTX Collapse
Federal Reserve Bank of Minneapolis President Neel Kashkari shared his view on the collapse of cryptocurrency exchange FTX on Friday.
“This is not it [a] a case of a fraudulent company in a serious industry,” he tweeted, elaborating:
The whole concept of crypto is bullshit. Not useful for payments. No inflation protection. No scarcity. No tax authority. Just a tool for speculation and bigger idiots.
Kashkari has never been a fan of bitcoin or crypto. He previously called them “a giant dumpster”. Last August, he said bitcoin and crypto were “95% fraud, hype, noise and confusion,” saying, “I have not seen any use cases other than financing illegal activities like drugs and prostitution.”
After the FTX meltdown, several Fed officials called for stricter regulation of cryptocurrency. Federal Reserve Deputy Chairman Lael Brainard has emphasized the importance of strong cryptocurrency oversight. “It’s really worrying to see that private investors are really getting hurt by these losses,” she opined.
Michael Barr, the Federal Reserve’s deputy chairman for supervision, said in response to a question during a Senate Banking Committee hearing last week:
We are concerned about the risks that we do not know about in the non-banking sector. That obviously includes crypto activity … which can create risks that blow back into the financial system that we regulate.
While Kashkari believes that the FTX collapse is not the case of one fraudulent company in the crypto industry, some have pointed out that the stock market meltdown is not crypto-specific. FTX and its former CEO Sam Bankman-Fried have been compared to the Enron fraud or Bernie Madoff’s Ponzi scheme.
Shark Tank star and NBA Dallas Mavericks owner Mark Cuban explained that recent explosions of companies in the crypto space, including FTX, “have not been crypto explosions.” He stressed: “They have been bank explosions … lending to the wrong entity, misvaluations of collateral, arrogant arbitrations, followed by depositor runs.”
What do you think of the comments made by Federal Reserve Bank of Minneapolis President Neel Kashkari? Let us know in the comments section below.
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