The head of the Federal Reserve said that although Bitcoin (BTC) has fluctuated too much to become a currency and is not backed by anything, it could be a substitute for gold.
Jerome Powell, speaking at an event organized by the Bank for International Settlements (BIS) on Monday, answered questions about cryptocurrencies.
“Bitcoin can be a substitute for gold, not the dollar”
Asked whether bitcoin and other cryptocurrencies pose a threat to financial stability, Powell made a statement in the style we are used to from traditional financial figures.
“Crypto assets are extremely volatile, so they are not very useful as a store of value and are not backed by anything,” Powell said.
“They are mostly used for speculation, so they are not used as a means of payment. They can be a substitute for gold for the dollar.”
In the past weeks, US Treasury Secretary Janet Yellen has also stated that they are concerned about the use of cryptocurrencies for illegal purposes.
The markets reacted negatively to Powell’s comments, just like Yellen’s statements, and the BTC / USD parity lost $ 1,000 in value.