The chairman of the Federal Reserve Bank of Dallas says bitcoin is clearly a store of value. He highlighted the differences between cryptocurrencies like bitcoin and central bank digital currencies, saying the latter would not necessarily be a store of value.
Head of Bundesbank calls bitcoin value store
Robert Kaplan, president of the Federal Reserve Bank of Dallas, spoke Friday about bitcoin and central bank digital currencies (CBDCs) at the Texas A&M Bitcoin 2021 conference, hosted by the Mays Business School.
First, Kaplan stated that he would make a distinction between bitcoin and central bank digital currencies. I would make a distinction between cryptocurrencies like bitcoin and ongoing discussions on digital currencies, such as China’s experiment with the digital yuan, he described.
He further explained that the problem with bitcoin is the degree to which it will be accepted. Developed by the director of the Federal Reserve Bank of Dallas:
For now, it’s clearly a valuable vault.
This is obviously very important, he continued. This may prevent it from becoming too widespread and accepted, but that may change and it will evolve.
The Fed governor also confirmed that he and his team have been keeping a close eye on bitcoin and other cryptocurrencies and will continue to do so.
He went on to talk about central bank digital currencies, noting:
The discussion of digital currencies around the world is different in that digital currencies will not necessarily hold their value.
If you are concerned about the value of the underlying currency, digital currency is likely to be pegged to the value of the underlying currency, for example in China, he explained, adding that it is also a way to facilitate payments, especially domestic payments, to get money where you need it.
Kaplan went on to say: In some cases, one could say that this is a way for China to monitor flows….. and ultimately how far these flows go, and there has been speculation about global payments and their consequences.
As for the digital dollar, Fed Chairman Jerome Powell said in February that the Fed is actively studying the possibility of issuing a digital dollar. He emphasized that this is a very high priority project for the Fed. Meanwhile, the Federal Reserve Bank of Boston and the Massachusetts Institute of Technology (MIT) plan to unveil at least two prototypes of the digital dollar in the third quarter of this year.
What do you think of what the president of the Dallas Fed said about bitcoin? Let us know your comments in the section below.
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