Janet Yellen denounces Bitcoin at New York Times DealBook Conference
By Bob Garcia
Despite the growing popularity of bitcoin, not everyone is bullish on the world’s best-known blockchain asset. On Monday, U.S. Treasury Secretary Janet Yellen criticized bitcoin. At the New York Times’ DealBook Conference, Yellen cautioned that bitcoin could prove hazardous to both investors and the public.
Of bitcoin Yellen said, “It is a highly speculative asset and you know I think people should be aware it can be extremely volatile and I do worry about potential losses that investors can suffer.”
Yellen’s concerns about bitcoin aren’t new. She previously referred to cryptocurrencies as highly speculative and remarked that many digital currencies are used regularly for illegal transactions.
Although bitcoin is a household name, it’s not a particularly popular payment option for day to day purchases. Compared to popular digital payment services like Venmo, PayPal, and Apple Pay Cash, bitcoin is slow and energy intensive.
Yellen noted, “It’s an extremely inefficient way of conducting transactions, and the amount of energy that’s consumed in processing those transactions is staggering.”
Yellen discussed the possibility of a digital dollar, but said that there were a lot of questions to be answered. She asked, “What would be the impact on the banking system? Would it cause a huge movement of deposits out of banks and into the Fed? Would the Fed deal with retail customers or try to do this at a wholesale level? Are there financial stability concerns? How would we manage money laundering and illicit finance issues? There’s a lot of things to consider here, but it’s worth looking at.”
Janet Yellen, who served as Chair of the Federal Reserve under President Barrack Obama and President Donald Trump, also brushed on other topics including climate change, rising debt levels, retail trading mania, and the rollout of the new $20 bill featuring Harriet Tubman.