Federal Reserve Chairman Jerome Powell Calls BTC A ‘Speculative Asset’ Amid Coinbase Direct Listing
Cryptocurrencies have been around for more than a decade and have just gained global relevance in the last two years.
This has been largely due to institutional investors seeing digital assets like Bitcoin as a hedge against inflation. However, the US Federal Reserve boss believes that crypto-assets are still not ripe for payments.
Crypto Is Just For Speculation
In a virtual interview organized by the Economic Club of New York, Powell said that cryptocurrencies are ideal as vehicles for price speculation. According to him, they have not attained the status of becoming a payment option.
Powell also said that cryptocurrencies like Bitcoin could be rightly compared to precious metals like gold, given the difficulty of mining them. And since humanity has always placed gold on a high pedestal, he feels that Bitcoin can transform into the same mold.
Powell’s comments may seem contradictory to crypto owners who believe that Bitcoin was created for payment services. The jury is still out on whether Bitcoin would function as a medium of exchange effectively. This is due to the development of solutions like sidechains and Lightning Network.
Just yesterday, the U.S-based bitcoin exchange Coinbase made its debut on Nasdaq as a publicly-traded company.
The milestone, which is a first for the crypto industry, is poised to attract more investments into the space.
Coinbase opened its shares to the investing public at a whopping $381 per share against the $250 reference price.
The company also made its Q1 report for 2021 public, noting that it generated over $1.8 billion in revenue and onboarded 56 million unique users since its founding.
BTC Better Store Of Value Than Gold
Powell’s views on cryptocurrencies are not entirely novel to the crypto universe. Last month, U.S Treasury Secretary Janet Yellen called Bitcoin a highly speculative asset and not fit to be used as a value transmission mechanism.
According to the well-known Bitcoin critic, value transmission through cryptocurrencies is an extremely inefficient way of conducting transactions. Her comments have not slowed down investments in the sector. Software company MicroStrategy owns Bitcoin worth billions of US dollars. The company’s CEO Michael Saylor sees Bitcoin as a better store of value than gold and other precious metals.
Recently, the company announced that non-employee board members will now be paid using Bitcoin.