Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, recently criticized Bitcoin, stating that it is filled with fraud, speculation, and chaos. He expressed concern about the consumer risks associated with Bitcoin and mentioned that despite existing for over 10 years, Bitcoin still lacks a legitimate use case in developed democratic countries.
During a LinkedIn event on Thursday, Neel Kashkari referred to Bitcoin as a “consumer protection problem.” He highlighted that some investors do not fully understand their cryptocurrency investments and cautioned that the volatility of cryptocurrencies could cause significant harm to certain individuals. Kashkari compared Bitcoin to Beanie Babies, stating that it lacks practical utility in the economy and is merely a cute toy that some people like to own and trade. He believes that the only purpose he sees for Bitcoin is for traders attempting to circumvent banking regulations, marijuana banking services, or engage in illegal activities.
In a comparison to Amazon, Kashkari pointed out that Bitcoin supporters argue that in 1994, no one ever bought books online, so Amazon was considered to have no future at that time. However, he disagrees and states that Bitcoin is not the 1994 version of Amazon; it is the 2004 version.
Neel Kashkari has been a long-time skeptic of Bitcoin. In 2021, he criticized 95% of cryptocurrencies, labeling them as fraud, speculation, noise, and chaos. He criticized cryptocurrencies for facilitating illegal activities such as drug trafficking and prostitution, and he did not see any other utility for them.
Kashkari previously questioned the creation of thousands of “junk coins,” some of which were outright Ponzi schemes. He questioned what problems these coins could solve, but no one could provide a clear answer.
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