Dan Morehead, CEO of Pantera Capital, said the US government’s controversial monetary policy could create bubbles in the financial system. In his view, the Fed “rigged” bond markets are real Ponzi schemes, not Bitcoin.

Danger comes from the Fed, not from cryptocurrencies

In a recent interview with Bloomberg, Morehead warned that bond-trading investors “will be utterly ruined if the Fed stops manipulating the bond market”.

Many critics of the crypto industry, such as Nobel Prize winners Paul Krugman and Richard Bernstein, have claimed for the past few months that Bitcoin is a Ponzi scheme (an investment scam that generates profits for previous investors by taking money from later participants).

Morehead vehemently contradicts this argument. According to him, the US mortgage bond market is the real Ponzi scheme, while cryptocurrencies could be a hedge if bubbles pop up in that sector:

“Governments should stop obsessing over Bitcoin and look to themselves. The largest Ponzi scheme in history is the US government and the mortgage bond market – $ 33 trillion – all run by a dominant non-economic actor trading in material, non-public information. ”

To intensify efforts in the digital assets space, Moreheads Pantera Capital – an investment firm focused on ventures and blockchain-related projects – raised $ 165 million through its crypto fund this summer.

Fed and Bitcoin

The central bank of the United States, the Federal Reserve, is a powerful institution in all respects capable of influencing the global financial network through its actions. Since the beginning of the COVID-19 pandemic, the Fed has given the US Treasury the green light to print trillions of dollars – a move that many believe would create more monetary problems, including inflation, which was rising rapidly.

In fact, a few months later, the rate of inflation in the United States exceeded 6% for the first time in decades. A few days ago, Nayib Bukele, President of El Salvador, asked the US authorities to stop printing such large amounts of dollars because the US dollar is widespread in his country.

However, apart from the greenback, the Latin American country was the first to accept Bitcoin as legal tender.

Speaking of the most important cryptocurrency: it is considered an asset that can withstand inflation worries with a limited supply of 21 million coins, and many experts consider it a suitable financial instrument in an economic crisis.

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Annie

According to Cryptopotato

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