Former Fed Chairman Ben Bernanke says bitcoin will not become an alternative form of money
during your monday Appearance on CNBCFormer Federal Reserve Chairman Ben Bernanke said that bitcoin is not going to act as an alternative means of payment.
Bernanke noted that it was intended to serve as an alternative to fiat money, and it has failed to succeed in that regard.
The famous US economist has noted that no one buys groceries with bitcoin because it is “too expensive” and “too inconvenient”.
According to Bernanke, pricing in bitcoin will be a major challenge as its value fluctuates significantly from day to day.
The former Fed chairman believes that bitcoin is mostly used for underground economic activities to buy illegal or illegal things.
However, he added that as long as people want to speculate, bitcoin will be around.
According to Bernanke, bitcoin has no inherent value because it is not used in dentistry or other industries.
“The underlying use value of bitcoin is ransomware or something like that,” he said.
Economists predict that the cryptocurrency will face a lot of regulation.
The Fed needs to act quickly
Bernanke, who left the Fed as chairman in 2014, oversaw the central bank’s response to the 2007–2009 financial crisis. He is particularly famous for introducing near-zero interest rates and quantitative easing to fight the Great Recession.
After the pandemic hit the US economy in 2020, Bernanke suggested pushing for negative interest rates, but the Fed did not go that far.
Bernanke also bailed out Wall Street firms and institutions to protect the corporate debt market.
In his latest interview, he criticized the Fed for waiting too long to respond to out-of-control inflation.
As reported by U.Today, the central bank earlier this May announced the biggest rate hike in 22 years, significantly reducing risk assets.