Federal Reserve Chairman Jerome Powell has warned Congress about the "dangerous" Bitcoin and other cryptocurrencies. Why are they dangerous? Because "unsophisticated investors" can buy or invest in them thinking they are "real currencies", which he says they are not.
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The previous Federal Reserve chair Janey Yellen was also a crypto critic, which Powell replaced this past February. Powell see amateur "unsophisticated investors" trying to get into the crypto market after seeing the price climb and thinking they will get into it because it's climbing, yet there is no guarantee that the price will keep climbing for them profit from it:
"relatively unsophisticated investors see the asset go up in price, and they think: 'This is great; I'll buy this.' In fact, there is no promise of that."
Powell told CNBC that it's not only investors that should be wary, as there are "consumer protection issues as well". That's the reason they want to regular the whole damn crypto sphere so that they can "protect" people who don't know what the hell they are doing. That deter people from adopting bitcoin and other crypto, he added that cryptocurrencies shouldn't be considered real currencies as they hold no intrinsic value.
But these words seem empty in substance, as people can look around the world to see how crypto is moving and shaking the financial sector. BlackRock is the world's largest asset manage, and it has confirmed it's establishing a cryptocurrency working group. Not to mention big shots like Goldman Sachs have already gotten into the market with their Circle purchase of Poloniex. Grayscale Investments is investing about $10 million each week. Nasdaq has also been exploring ways to profit off the burgeoning crypto market.
How's that for a promotion of the cryptocurrencies rather than a warning to stay away, Mr. Powell?
Despite negative remarks about crypto, he seems to appraciate blockchain technology, saying blockchains "have significant applications in the wholesale payments part of the economy."
Powell isn't the only Federal Reserve stooge to be against crypto, as the president of the Federal Reserve Bank of Atlanta, Raphael Bostic, has warned people to not invest in bitcoin because it and crypto "are not currency". The head of the Minneapolis Fed also thinks crypto is a "farce" as he
compared them to the Beanie Babies phenomenon. hype and overvaluation. Some Beanie Babies are apparently worth up to $90,000.
Not all Fed branch executives are naysayers to the crypto boom. The St. Louis branch publichsed a report on BTC saying it has many similarities with cash, and "welcomes anonymous cryptocurrencies." It even added 4 crypto price trackers -- bitcoin (BTC), ethereum (ETH), bitcoin cash (BCH), and litecoin (LTC) -- to it's economic database.
As far as "no intrinsic value" the Federal Reserve Bank of San Francisco disagrees since it issued a report that theorized BTC has an intrinsic value of $1,800. This was calculated from the cost of mining a single coin. The current value of BTC Is higher than that, near $8,000. Does that mean BTC is overvalued, or simply that the intrinsic value doesn't determine the actual value in the market? I think it's the latter.
It seems not all the Federal Reserves are playing the same ball game. There is some dissension in the ranks. Crypto is here to stay, despite the remarks that it's a passing fad or farce akin to Beanie Babies. The top financial powers have no real interest in helping people become more wealthy, despite how some underlings appear to be in favor o want to help people get into crypto.
Though some are more honest about the opportunity than others, it doesn't mean they will openly welcome a decentralized asset class outside of their influence and control. But I don't think they will be able to stop the tide of crypto as it washes over the world and cleanses the dominating influence of the banksters and financial elite.
Thank you for your time and attention. Peace.
References:
- Bitcoin Not a Real Currency, Risky for ‘Unsophisticated Investors’: Fed Chair Powell
- Fed Chairman Powell says cryptocurrencies present big risks to investors
- Federal Reserve’s Kashkari Rips Cryptocurrency Market: ‘It Has Become a Farce’
- Federal Reserve Branch Adds Cryptocurrency Price Indexes [Yes, Really]
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