Neel Kashkari, President of the Reserve Bank of Minneapolis, has said that the “entire notion of crypto is nonsense”.
As crypto continues to be dragged down by the undertows of the FTX collapse, just the latest in a series of spectacular meltdowns and bankruptcies, Neel Kashkari has seen fit to heap scorn on the industry by calling it nonsense, and a “tool of speculation and greater fools”.
Kashkari scoffed at the industry in a twitter post last Friday, saying that it wasn’t useful for payments, wasn’t an inflation hedge, had no scarcity, and no taxing authority.
This is interesting but 2 narrow. This isn’t case of 1 fraudulent company in a serious industry. Entire notion of crypto is nonsense. Not useful 4 payments. No inflation hedge. No scarcity. No taxing authority. Just a tool of speculation & greater fools. https://t.co/9yweHwwgOL
— Neel Kashkari (@neelkashkari) November 18, 2022
The Fed bank president also retweeted a post by Twitter account Katie Martin, who said:
“The overriding goal of policymakers should be to keep crypto systemically irrelevant.”
Kashkari has made it more than plain what he thinks of the crypto industry in recent history, saying:
“I’ve not seen any use case other than funding illicit activities like drugs and prostitution.”
Opinion
The Minneapolis President has his axe to grind. If crypto were to come up with a means of payment that were widely adopted then the Fed would lose control and its raison d’être.
Saying that crypto had no scarcity was frankly risible. Would he have known that Bitcoin only has a maximum supply of 21 million coins? It would be extremely interesting for him to elaborate on just how scarce the dollar is these days as it gets printed towards oblivion.
Finally, to say that crypto has no use cases other than prostitution or drug activities is just wrong on so many levels. Whatever anyone may think of crypto, it’s risen out of an overwhelming need of the common retail investor to protect themselves from the monetary policy decisions of the kind that people such as Kashkari espouse.
The boot is most definitely on the foot of the Federal Reserve. It holds the most unbelievable power over the world’s finances, and it will undoubtedly continue to influence governments and financial institutions across the world.
However, if the fiat monetary system were analysed over the decades of its use, the fraud that has been committed on the grandest scale ever in history would become apparent.
How are people supposed to maintain their wealth if the currency units they are using are losing at least 10% of their purchasing power each year? Nothing has been done to address this by the Federal Reserve.
Crypto is an experiment. The implementation of a new technology will probably see many failures along the way. However, a replacement for the currency system we still have absolutely must be found. Central Bank Digital Currencies (CBDCs) are not that replacement.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
