Ex-Fed Chair Ben Bernanke warns Bitcoin with risks should be wary of

Ben Bernanke, former chairman of the Federal Reserve (Fed), has issued a warning to Bitcoin (BTC) investors. According to the former Fed chairman, cryptocurrency is too complicated to be used as money.

Former Federal Reserve Chairman Ben Bernanke told CNBC on Monday that he does not believe Bitcoin can be used as money, a store of value, or digital gold. He also says Bitcoin faces two existential risks from lawmakers and governments.

“One of the other risks that Bitcoin has is that it could, at some point, be subject to a lot more regulation. And the anonymity is also at risk, I think, at some point. So investors in Bitcoin should be aware of that.”

“If bitcoin were a substitute for fiat money, you could use bitcoin to go buy your groceries,” he said. “Nobody buys groceries with bitcoin because it’s too expensive and too inconvenient to do that.” He added, noting how it would be impossible to price something like celery in Bitcoin because there’s too little stability in its value.

Ben Bernanke, dubbed “Helicopter Ben” for suggesting in 2002 that the Fed could simply drop money from helicopters to combat deflationary conditions – a remark that the cypherpunks who laid the groundwork for Bitcoin were no doubt well aware of – addressed the digital gold case for Bitcoin.

“Gold has underlying use value, you can use it to fill cavities. The underlying use value of a Bitcoin is to do ransomware or something like that,” Bernanke argued.

In terms of monetary policy, Ben Bernanke, who was a driving force behind the original zero interest rate policy and quantitative easing, chastised the current Fed for not acting quickly enough to tighten monetary policy in the face of rising inflation.

However, he expects that Bitcoin and cryptocurrencies “will be around as long as people are believers and they want to speculate.”

Currently, the price of the world’s 1st cryptocurrency is trading at 30,000 and is still moving in a positive direction with the US stock market due to the influence of Fed policies.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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