US Treasury Secretary Janet Yellen once again spoke about Bitcoin and the challenges facing global powers today in the context of financial markets.
Yellen talks about BTC again
At the New York Times DealBook conference, Yellen questioned the technical and economic capabilities of Bitcoin.
– I don’t think Bitcoin, as I said, is widely used as a trading mechanism. (…) This is an extremely ineffective way of carrying out transactions. And the amount of energy used in processing these transactions is staggering – she said.
Only the data from the Global Cryptoasset Benchmarking Study from Cambridge showed that 75 percent. miners from the cryptocurrency market use renewable energy sources in the mining process. Kraken’s executive director, Dan Held, says BTC uses much less energy than the banking sector.
Another thing is that while the transaction speed of the Bitcoin network is much slower than the bandwidth of payment companies such as Visa, cryptocurrency users are able to send digital assets in minutes for really low rates.
However, the treasury secretary also added that she is also concerned about the losses that Bitcoin investors may incur due to the volatility of the cryptocurrency exchange rate.
– It is a highly speculative asset. And you know, I think people should be careful that it can be very unstable. I am concerned about potential losses for investors – she said.
CBDCs are needed
As for the central bank’s digital currencies (CBDCs), Yellen says she believes they will help promote “Financial integration” in Usa.
– We have a problem with financial inclusion. Too many Americans do not have access to payment systems and bank accounts. And I think that’s something the digital dollar, the digital currency of the central bank, could help with. I think this could result in faster, safer and cheaper payments – she explained.
However, Yellen warns that there are concerns that need to be addressed before the digital dollar is brought to market.
– There are a number of issues with central bank digital currencies that need to be investigated. What would their impact on the banking system be? Would this cause a huge flow of deposits from banks to the Fed? Would the Fed deal with retail customers or would it try to do so at the wholesale level? Are there any concerns about financial stability? How we would handle money laundering and illegal finance? – she added.
But as the thought concluded, “It’s absolutely worth a look.”