On Monday (29 October 2018), Janet Louise Yellen, the Chair of the Board of Governors of the Federal Reserve System from 3 February 2014 to 3 February 2018, speaking at the 2018 Canada Fintech Forum (held in Montreal), told the audience that she was not a fan of Bitcoin, and then proceeded to explain why.
Of course, this was not the first time that the former Fed Chair was expressing her disdain for Bitcoin.
According to CNBC, at a press conference following the two-day Federal Open Market Committee (FOMC) meeting in Washington, D.C. on 13 December 2017, Yellen had this to say about Bitcoin:
“Bitcoin at this time plays a very small role in the payment system. It is not a stable source of value and it does not constitute legal tender. It is a highly speculative asset.”
And when asked if the Fed was considering creating its own cryptocurrency, she answered:
“I really want to caution, this is not something the Federal Reserve is seriously considering at this stage. While we're looking at research on this topic, there are, I think to my mind, limited benefits from introducing it, a limited need for it and some substantial concerns.”
Janet Yellen: “I am not a fan of Bitcoin. Let me tell you why”.
Former Central-Banker-in-Chief proceeds to meticulous 5-minute rant against Bitcoin, robotically spewing scripted FUD talking points to Finance/Bank VIPs.
They're scared. Buy Bitcoin.⚡https://t.co/kEvUlwUZfc
— Francis Pouliot (@francispouliot_) October 30, 2018
Here were Yellen’s main reasons for not being a fan of Bitcoin:
“I know there are hundreds of cryptocurrencies and maybe something is coming down the line that is more appealing, but I think first of all, very few transactions are actually handled by Bitcoin, and many of those that do take place on Bitcoin are illegal, illicit transactions.”
“It has long been thought that for something to be a useful currency, it needs to be a stable source of value, and Bitcoin is anything but. So, it's not used for a lot of transactions; it's not a stable source of value; and it's also not an efficient means for processing payments. It's very slow in handling payments.”
Yellen also said that because of Bitcoin’s decentralized nature, “the amount of energy that is used to process transactions and the cost of them is very high in comparison with the means of payments we use ordinarily.”
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