Federal Reserve Chairman Jerome Powell Criticizes Cryptocurrencies as Payment Tools

Jerome Powell Says Cryptocurrencies Are Not Used

Jerome Powell, chairman of the Federal Reserve (FED) seems not to be very positive about virtual currencies. According to some reports, Mr. Powell said that cryptocurrencies are not accepted as a means of payment.

This is not the first time that Powell criticizes cryptocurrencies and Bitcoin. For example, back in July, he said that virtual currencies do not have intrinsic value. Moreover, he mentioned that they have high volatility and that because of these reasons they cannot be considered as currencies.

On the matter, the FED chairman said:

“If you think about what currencies do, they’re supposed to be a means of payment and a store of value. And cryptocurrencies… they’re not [really] used very much in payment. Typically people sell their cryptocurrencies and then pay in dollars. [Regarding] a store of value, you know, look at the volatility, and… it’s just not there.”

At the moment, cryptocurrencies are being used as a means of payment by several users all over the world. And this can be measured using the number of transactions.

Bitcoin has also registered more value transacted than PayPal and Discover, two important payment processors around the world. At the same time, the transactions processed by the Bitcoin network are growing and could soon reach MasterCard and Visa.

However, the number of transactions processed by Bitcoin are far from reaching PayPal, or other companies such as Visa or MasterCard. At the moment, Bitcoin is not able to handle the transaction throughout that other competitors are currently managing.

In the future, cryptocurrencies and Bitcoin itself would be able to handle more transactions than never before. However, it will take time for this to happen. Bitcoin and Ethereum are working in order to scale their networks.

The Lightning Network and Sharding, as these scaling solutions are known, will be available in the near future.