Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, recently criticized Bitcoin, stating that it is filled with fraud, speculation, and chaos, which raises concerns about consumer risks. He also mentioned that Bitcoin has been in existence for over 10 years, but it still lacks legal applications in developed democratic countries.
During a Linkedin event on Thursday, Neel Kashkari expressed his view that Bitcoin is a “consumer protection issue” because some investors do not fully understand their cryptocurrency investments. He also warned that the volatility of cryptocurrencies can cause significant harm to some people. Neel Kashkari compared Bitcoin to Beanie Babies, stating that it lacks practical use in the economy and is merely a cute toy that some people like to own and trade. He believes that the only purpose of Bitcoin is for traders to attempt to subvert banking regulations, bypass marijuana banking services, or engage in illegal activities.
Neel Kashkari compared Bitcoin to Amazon, noting that supporters of Bitcoin would argue that in 1994, no one bought books online, and Amazon was considered to have no future at that time. However, he disagrees and believes that Bitcoin is not the Amazon of 1994, but rather the Amazon of 2004.
In fact, Neel Kashkari has always been skeptical of Bitcoin. In 2021, he criticized cryptocurrencies, stating that 95% of them are fraud, speculation, noise, and chaos. He criticized cryptocurrencies for facilitating illegal activities such as drug trafficking and prostitution and did not see any other uses for them. He also pointed out that thousands of worthless coins have been created, some of which are outright Ponzi schemes, where project founders deceive people into investing and then take advantage of them. He always asks what problems these coins can solve, but no one can provide a clear answer.
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