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The Crypto Statement of the Year? The speech is not Powell's

28-Aug-2022 By: Simran Mishra
The Crypto Statement

The remarks made by Fed Chair Jerome Powell at the annual Jackson Hole conference were very important. The most significant statement regarding cryptocurrency, though, may come from another Fed official. Neel Kashkari's remark on CBDCs, according to Nick Anthony of the Cato Institute, is the crypto statement of the year. Kashkari is the president of the Minneapolis Fed.

Powell's statement halted a significant bullish surge in its tracks and reduced consumer fervour. In terms of economic expectations, it also outlined what to expect in the next year. The future of cryptocurrency may be determined by Kashkari's remarks on central bank digital currency, though.

A central banker activates CBDC

Regional Bank Centralized forms of fiat money are known as digital currencies. They lack the trustless and decentralised characteristics of cryptocurrencies like Bitcoin and Ethereum, as critics have frequently pointed out. CBDCs are directly impacted by the Fed's monetary policy.

Undressing Bitcoin author Layah Heilpern thinks that CBDCs could be configured to increase censorship. Kashkari, who is a central banker, has recently expressed similar views on the currency. He thinks that, rather than the US, China should use CBDCs for monitoring. Kashkari also thinks that CBDCs don't have any significant applications. Simply utilise Venmo if the plan is to transmit centralised funds. Additionally, he thinks that CBDCs lack Bitcoin and other cryptocurrencies' advantage for cross-border payments.

The founder of ShapeShift, Erik Voorhees, attacked the United Nations' suggestion to outlaw cryptocurrencies and establish a CBDC. According to him, centralised digital currency serves the state rather than the consumer as a solution. He says that the CBDC is the solution for keeping track of all of the population's financial activity.

Who Else Will Share Kashkari's Opinions?

Jerome Powell, the head of the Federal Reserve, said that the United States has to investigate the possibility of a digital dollar as a nation. He also disclosed that he would advise Congress on how to proceed with creating a CBDC.

Only a few Fed officials, including Kashkari, have voiced opposition to the idea of centralised digital currency.

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