“I’m worried” – Fed President makes “incredible” Bitcoin price prediction amid shocking inflation warning
BitcoinBTC has defied its harshest critics with a rapid price rally in recent months (and could now be poised for its biggest month ever).
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Bitcoin price has surpassed $70,000 per bitcoin, rising from a low of $15,000 in late 2022. “Leaks” sparked wild speculation this week about a change in direction on Wall Street.
Now, as the market prepares for a huge inflation reversal from the Federal Reserve, Fed President Neel Kashkari has given an “incredible” answer to the question: “When will the Fed add Bitcoin to its balance sheet?”
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Federal Reserve President Neel Kashkari was asked when the Fed will add Bitcoin to its balance sheet … [+]
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“You have already gone on record saying that you have an unlimited supply of dollars. Doesn’t it make sense to exchange some of them for a currency with a fixed cap?” Pensions & Investments editor-in-chief Jennifer Ablan asked Kashkari during a LinkedIn Live event on behalf of an audience, referring to the fixed Bitcoin supply of 21 Million Bitcoin.
“What kind of hard cap is this,” replied Kashkari, the president of the Federal Reserve Bank of Minneapolis. “The hard cap on Bitcoin could be zero, it could go to zero. Just replace the word Bitcoin with Beanie Babies. Should the Feds buy Beanie Babies because Beanie Babies were a fad for a while?”
In order to change Bitcoin's “hard cap” of 21 million, a majority of Bitcoin miners who maintain the network in exchange for Bitcoin would have to vote for a change. This would “fork” the network, with the minority of miners still retaining the Bitcoin with a hard cap of 21 million.
Kashkari said that like Beanie Babies, Bitcoin “has no real use for the economy other than being a nice toy that some people like to own and trade.” The only use for Bitcoin is “to subvert banking regulations and circumvent marijuana banking or illegal activities.”
Bitcoin “has been around for more than a decade, and more than a decade later there is still no legitimate use case in an advanced democracy,” Kashkari said, warning: “There is a lot of fraud, hype and confusion, that's why I'm worried .” a consumer perspective.”
Alex Gladstein, chief strategy officer at the Human Rights Foundation, described Kashkari's comments as “incredible” and said the clip will be “studied by future historians.”
“The last two words are interesting,” Gladstein posted
Bitcoin has found demand in countries suffering from hyperinflation, such as Turkey and Venezuela, in recent years.
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Bitcoin price has recovered from its 2022 price decline and is above $70,000 per Bitcoin.
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Gladstein added that there are “dozens of legitimate use cases for Bitcoin in an advanced democracy, ranging from managing the electric grid to sending money abroad to saving for your family’s future, from micropayments to multi-sig treasury management “Ranging from converting waste energy into profit to reducing methane emissions to building a surveillance-resistant digital commerce experience to charitable donations.”
Kashkari, who is among the more hawkish members of the Federal Reserve's Federal Open Market Committee (FOMC), which sets interest rates, continued to warn that the Fed may not cut interest rates at all this year if inflation does not fall further.
“If inflation continues to move sideways, I would question whether that is the case [need] to make these rate cuts in the first place,” Kashkari said.
Bitcoin's price rise in recent months is partly due to market expectations that the Fed will soon have to cut interest rates from their post-2008 crisis peak as the US struggles with its mounting debt pile.
Last month, Michael Novogratz, CEO of Bitcoin and crypto financial services company Galaxy Digital, predicted that Bitcoin price and the broader crypto market would benefit from the gigantic US debt.
“There is a number that I think you should keep an eye on: $34 trillion in debt, and in 100 days it will be $35 trillion, and in 200 days it will be $36 trillion “As other countries get their finances in order, the story of Bitcoin and other digital assets will continue to grow,” Novogratz said during the company's recent earnings call. “The [bitcoin] The story is powerful right now.”
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