At the recent 2017 Financial Stability and Fintech Conference, Federal Reserve vice chairman of supervision Randy Quarles stated that people pulling their money out of fiat currencies like the United States dollar and putting them into cryptos like Bitcoin "may not pose major concerns at their current levels of use," but that in time, "more serious financial stability issues may result if they achieve wide-scale usage."
Sponsored by the Federal Reserve Bank of Cleveland, this meeting at which Quarles spoke dealt with all sorts of issues ranging from general financial stability to the role of the private Federal Reserve in issuing and controlling what most people today falsely assume is a public, government-issued currency (in reality, the U.S. dollar is a fake fiat currency controlled by a private group of individuals working on behalf of their own interests).
While rumors have recently begun to circulate that the Federal Reserve might be considering the issuance of its own Bitcoin knockoff in the near future, the private banking group has since denied such claims, insisting that its Monopoly-like Federal Reserve Notes are probably here to stay.
At the same time, both the Trump administration and the Federal Reserve have indicated that they intend to "keep an eye" on Bitcoin (as if they're some kind of all-powerful entity that gets to decide who puts their money where).
"The [Bitcoin situation] is something that is being 'monitored' by our team – Homeland Security is involved," White House Press Secretary Sarah Huckabee Sanders stated recently upon being asked by a reporter if President Trump has an opinion on Bitcoin.
"I know it's something that he's [Trump] keeping an eye on – And we'll keep you posted when we have anything further on it."
In a humorously ironic explanation as to the alleged "drawbacks" of cryptocurrencies like Bitcoin, Quarles added at his meeting that these digital assets aren't backed by anything of actual value, and neither do they have any "intrinsic" value.
What makes such a claim absolutely ludicrous is the fact that the U.S. dollar is similarly worthless, backed only by the promise of value and people's trust that it even hold value. The only difference between Bitcoin and the U.S. dollar is the fact that the U.S. dollar is printed on a piece of paper.
Meanwhile, Bitcoin prices have been all over the place after reaching an all-time high of nearly $12,000 per coin. And while the prospects of profiting from this boom might be tempting to many casual observers who are just now learning about Bitcoin, some financial experts warn that the risks are simply too great.
According to CNBC's Vitor Constancio, for instance, the price fluctuations of Bitcoin make it "a speculative asset by definition." He also says that anyone who invests in Bitcoin is "taking that risk of buying at such high prices."
"We don't have responsibility or even instruments that point to particular prices of particular assets, that is certainly not the role of central banks," he claims.
Others, however, insist that Bitcoin is only heading "to the moon," at this point. Famed stock picker Ronnie Moas is convinced that Bitcoin will reach a price of $20,000 per coin by 2018, even despite split-adjusted price changes resulting from splits and forks.
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