In an event hosted by the Bank for International Settlement, Jerome Powell,the chair of the United States Federal Reserve, weighed in on the Bitcoin argument by saying that the cryptocurrency is a substitute for gold, rather than the dollar.
His view touched on the recurrent theme that's been peddled by bears and detractors like Peter Schiff over the years.
According to him, the high rate of volatility makes it incapable of being used as a legal tender. Culling from the same point, he was also quick to suggest that "Bitcoin isn't backed by anything", once again peddling the "based on thin air" analogy.
However, if he considers Bitcoin to be based on nothing then how is it suddenly a substitute for gold? Also, isn't gold suppose to be the standard? If you consider Bitcoin to be a substitute for the gold standard, then doesn't that just mean that fiat you compare Bitcoin with will only just be hinged on Bitcoin for value as well?
It's always been the case with politicians and government agents. There's subtle apathy and they express it in just that way. This recent show of animosity towards Bitcoin coincided with a $1k drop in value.
According to the government, only an asset backed by the government can hold water. Uhm, yeah, didn't we know that already?
Conversations about stable coins also popped into the mix and it was pretty much the same thing.
With CBDCs in advanced development and countries like Venezuela and Bahamas already deploying their variants, stable coins will naturally play a big role.
However just like his usual stance, Powell sticks with the same script by claiming;
To the extent a stablecoin is backed by sovereign currencies of leading nations, that's certainly an improvement over crypto assets, I would say
The government official and pro fiat champion by occupation claimed that fiat is in the interest of the public. Who needs a Decentralised financial system when you can just hold fiat that's manipulated by the government and used to fund wars that the citizens didn't ask for?