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Fed governor says CBDCs remain ‘a solution in search of a problem’

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Chris Waller, a member of the Board of Governors of the Federal Reserve System (Fed), seems to think it’s unnecessary for the United States government to develop a central bank digital currency, or CBDC.

Speaking with Michael Strain of the American Enterprise Institute today, Waller said he was “highly skeptical” of a central bank digital currency, addressing issues in existing payment systems. He feels that the U.S. government should only intervene with a potential digital solution in the event of significant market failures.

“I am not convinced as of yet that a CBDC would solve any existing problem that is not being addressed more promptly and efficiently by other initiatives,” said Waller.

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He added:

“The private sector is already developing cheaper payment alternatives to compete with the banking system, hence it seems unnecessary for the Federal Reserve to create a CBDC to drive down payment [systems] we see by banks […] Facilitating speedier payments is not a compelling reason to create a CBDC.”

Screenshot from American Enterprise Institute

Specifically, the Fed governor said he believes that the government should not be competing with the private sector, given that the potential benefits of a CBDC may be outweighed by privacy concerns and would likely not address the issue of financial inclusion or encourage faster and cheaper payments. Waller cited a 2019 survey from the Federal Deposit Insurance Corporation, estimating that only 1% of households in the United States were both unbanked and might be interested in using a CBDC.

However, Waller also expressed concern with potential CBDC designs giving the Fed access to “a vast amount of information” from account holders. According to the Fed governor, the system would make it a tempting target for hackers, and be more akin to China regulating how it monitors the transactions of its citizens with the digital yuan.

“A CBDC remains a solution in search of a problem.”

Waller’s comments come two months after Fed chair Jerome Powell said that the government agency would be issuing a discussion paper on CBDCs in the United States, calling on the public to comment “on issues related to payments, financial inclusion, data privacy and information security.” Powell said the paper would be released sometime this summer, giving the Fed roughly six more weeks to publish.

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Unlike Waller, Powell’s public statements on CBDCs have seemingly been more measured, often saying it is more important “to get it right than it is to be first” when it comes to rolling out a digital dollar. President of the Dallas Federal Reserve Robert Kaplan also said in November that it is “critical that the Fed focuses on developing a digital currency.”

Other U.S. lawmakers have spoken in favor of CBDCs when comparing a central bank-issued digital currency with cryptocurrencies like Bitcoin (BTC). Democratic Senator Elizabeth Warren said in June that the tokens had “great promise,” calling CBDCs “legitimate digital public money” that could drive out “bogus digital private money” like crypto.

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The Cycle Started, Mike Novogratz Says – Bitcoin Boom Is Here; Jack Dorsey Boosts BTC’s Price

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Mike Novogratz is one of the essential names in the crypto space which is celebrating the booming price of Bitcoin.

Check out what he had to share with his followers and Twitter fans:

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Someone hopped in the comments section and said this; ‘Anyone who has not yet embarked on the crypto band wagon is a simple minded idiot who knows nothing about markets, freedom or wealth creation.’

Jack Dorsey boosts the price of BTC

It’s been also revealed that Jack Dorse said that Square could build a BTC mining system – this obviously triggered a more massive price race for the king coin.

At the moment of writing this article, BTC is trading in the green and the king coin is priced at $61,118.15.

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CNBC online publication just noted that Square CEO Jack Dorsey said late on Friday the company is considering jumping into BTC mining business.

Dorsey tweeted that the company is considering a “bitcoin mining system based on custom silicon and open source for individuals and businesses worldwide.”

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Dorsey’s goal would be to make crypto mining more accessible. We suggest that you check out the complete thread that Dorsey shared on his social media account in order to learn all the available details.

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Pantera Capital’s Dan Morehead: Bitcoin (BTC) Already Up 100% in This Bull Run

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How big is median increase in Bitcoin (BTC) price in bullish market phases?

As Bitcoin (BTC) reclaims $62,000 level, Dan Morehead, CEO of the first-ever cryptocurrency-focused VC firm in the U.S., shares the comprehensive statistics of the last six bull runs for Bitcoin.

Bitcoin (BTC) price doubled in 87 days: Bull Run 2021

According to the latest tweet by Mr. Morehead, the Bitcoin (BTC) price witnessed a 2x increase in the first 87 days of the ongoing bullish wave.

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Unlike many other experts, Mr. Morehead identifies two separate “bull run” phases in 2020-2021. During the previous one, between March 16, 2020, and April 14, 2021, it took 394 days for Bitcoin (BTC) to increase its price 13x and print a new all-time high.

According to his infographic, the most impressive rally ended with a 106x increase of the orange coin’s price in 2015-2017.

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That said, the median Bitcoin (BTC) price bull run lasted for 300 days and increased the “king coin’s price” by 15x.

Will Bitcoin ETF mark the top of the BTC cycle?

At the same time, according to “The Next Price Era” letter issued by Pantera Capital on Oct. 6, 2021, the hotly-anticipated approval of Bitcoin (BTC) ETFs is listed amidst the possible “sell the news” events.

Mr. Morehead noticed that the launch of CME Bitcoin Futures and Coinbase direct listing triggered painful bear markets:

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Will someone please remind the day before the bitcoin ETF officially launches?  I might want to take some chips off the table.

As covered by U.Today previously, similar statements were made by CNBC’s Jim Cramer.

The seasoned analyst also revealed his plans to “cash out” 50% of his Ethereum (ETH) bags.

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Bitcoin Will Significantly Underperform Altcoin Market As New Crypto Price Era Unfolds: Pantera Capital’s Dan Morehead

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The founder and chief executive officer of Pantera Capital says that investors can expect altcoins to outperform Bitcoin (BTC) in the long term.

In a recent edition of Pantera’s Blockchain Letter, the head of the digital asset management firm outlines Dan Morehead’s key quotes from the SALT 2021 conference in New York. During the conference, Morehead said that even though his company has greatly profited from BTC, he emphasized that most future crypto gains will come from altcoin investments.ADVERTISEMENT

“My perspective is: Bitcoin has been amazing – Pantera Bitcoin Fund is up 67,000% since inception. However, I think the majority of future gains will be from tokens outside of Bitcoin. I know that sounds heretical to some people here, but that’s my professional opinion.”

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Morehead compares the rise of Bitcoin and its competitors to that of the tech industry boom during the late 1990s.

“It’s like saying in 1998 that [the] majority of future tech gains would come from outside Microsoft.

At the time, Microsoft was worth $218 billion, Apple $3.5 billion, Amazon was $2.2 billion. Google and Facebook were zero – they didn’t even exist. In the years since Microsoft did great – it went up 10x. However, 80% of the tech gains in these five stocks came from outside Microsoft.

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That’s the view I have here – I think BTC is going to go up a ton – like 10x. It’s a great investment…[but] I think the broader portfolio is going to outperform.”

At time of writing, BTC has a market cap of $1.156 trillion while all altcoins combined have a market cap of $1.327 trillion, according to CoinMarketCap.

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