U.Today – Former New York Federal Reserve Chairman Bill Dudley expressed concern about the possibility of inclusion in the U.S. national reserve.
The idea of a national Bitcoin reserve has gained traction this year among some policymakers and crypto enthusiasts, who argue it could provide a hedge against inflation and diversify U.S. financial assets. are.
While Dudley believes crypto technology has the potential to improve the financial system and that Bitcoin reserves could drive BTC prices higher, BTC reserves are not beneficial overall. He argues that there may not be.
At the time of writing, BTC was trading at $98,854, down 4.31% over the past 24 hours. It hit an all-time high of $104,000 during yesterday's trading session.
Bitcoin reserves could drive BTC price higher
In a Bloomberg opinion piece, former New York Fed President Bill Dudley explains why he doesn't think Bitcoin reserves are a good idea. Bitcoin reserves could accelerate inflation and worsen government finances, leaving governments in limbo. Holding volatile tokens that do not generate income.
According to Dudley, Bitcoin hardly qualifies as money, and its instability makes it unsuitable as a medium of exchange. In most countries, people don't have to take it as money, he pointed out. “Transactions are slow and expensive, and validating each one requires significant computing power and energy,” Dudley said.
However, the former Fed chairman believes that Bitcoin has some positive properties: “It's portable, and you can store millions of dollars' worth of money on a USB stick. Keys are semi-anonymous in the sense that they are identified only by alphanumeric characters, and can be transferred anywhere to anyone, without relying on government-regulated banks or other traditional financial intermediaries. ”
Dudley believes that if a Bitcoin reserve is enacted, investors will rush in to get ahead of the government's purchases, which will undoubtedly drive up the price of Bitcoin, but could also lead to inflation. There is.
This article was originally published on U.Today
