FED Chair Says Cryptocurrencies have no Intrinsic Value and are Great Only for Easier Money Laundering Ability
Chairman of the United States Federal Reserve, Jerome Powell, has directed some hard words to cryptocurrencies during a recent appearance in front of the US Congress.
While speaking to the House of Financial Services Committee, the head of the United States Central Bank stated las Wednesday that crypto tokens like Bitcoin carry no real value on an intrinsic level. They also bring several risks to the table for investors, as reported by CNBC. Some of the concerns come from inside the crypto sphere – saying that there are too many unsophisticated investors who get to see the prices climb, then think to themselves – this is awesome, I’ll buy some too (with no guarantee the climb will happen again).
He also added:
“It's not really a currency. We're not looking at this as something that we should be doing … Mainly I have concerns. If you think about what currencies do, they're supposed to be a means of payment and a store of value basically and cryptocurrencies are not used very much in payment … and in terms of the store of value, if you look at the volatility it's just not there.”
Another point he made was that cryptocurrencies are difficult because they’re ideal for fraud like money laundering, which is something we must be extremely conscious of.
With that said however, there are investors and consumers who need to be protected. Powell stated that the cryptocurrency market, isn’t big enough to actually pose a threat to the stability of finances on a global scale, therefore the FED isn’t looking to regulate it just yet, according the financial news giant Bloomberg.
Powell gave his testimony only hours before the Financial Services Committee set to host yet one more hearing that focused on cryptocurrency and their future. As reported in a prior article by CoinDesk, the new committee hearing will target the question on whether to make crypto coins a new official worldwide currency or not.
One memo published following the hearing was made, it stated most notably that member will examine the potential for cryptocurrency with taking in mind the extent to which United States Government Agencies should consider cryptocurrencies a real money and the possibility for domestic or global uses for the virtual tokens.
What do you think? Should cryptocurrencies like BTC and ETH be considered real money? How will that effect the global economy and more importantly the crypto world? Speak your heart in the comment section below.