“Bitcoin boom won’t last long”… Fed warned again

As the rally continues, with Bitcoin’s market cap exceeding $1 trillion (about 1106 trillion won), US economic heads continue to voice concerns over overheating.

The New York Times said on the 19th (local time) that Boston Federal Bank Governor Eric Rosengren said that the recent bitcoin surge “will be under pressure over time.”

In an article titled “A Fed president predicts the Bitcoin boom won’t last,” the New York Times said, central banks are making their own alternative cryptocurrencies. It was reported that it predicted that Bitcoin could not survive long because of the possibility.

“I expect many central banks will have digital currency,” said Rosengren. “If digital currency is available, I don’t know what is the reason for people to use bitcoin other than the underground economy.”

Such remarks by President Rosengren are interpreted as revealing the view that bitcoin is only used as a negative tool, such as concealing criminal proceeds, and has no positive effect on the economy.

US Treasury Secretary Janet Yellen has also recently made a negative comment on Bitcoin, citing the need for regulation.

Finance Minister Yellen said on the 18th, “Bitcoin is a very speculative asset.” “It is very important to regulate the institutions that handle bitcoin and keep them accountable.”

Earlier last month, he said, “I think a lot of cryptocurrencies are mainly used for illegal finance,” and “It is necessary to consider ways to reduce such use and prevent money laundering.”

Jerome Powell, who is responsible for US monetary policy, is in a similar position. Although I haven’t mentioned bitcoin directly recently, it has revealed negative perceptions a few times in the past.

In 2018, Fed Chairman Jerome Powell pointed out, “Virtual currency has no intrinsic value. Relatively modest investors think that the price of cryptocurrency will rise and they think it is good, but there is no guarantee that it will.”

On this day, the market cap of Bitcoin exceeded 1 trillion dollars for the first time ever. Bitcoin price has soared 350% over the past six months, and has risen 64% only in February.

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