WASHINGTON, June 28, 2021 (AFP) – The digital craze, including calls for the creation of official cryptocurrencies, may seem like an unfortunate fad, Fed Vice President Randall Quarles said on Monday.
“America’s centuries-old enthusiasm for new things” was mostly beneficial, with the executive warning that while that enthusiasm is “coupled with an equally American sensibility for zealous promotion and fear of being left out, it can sometimes be rampant.” But leads to suspension. Our critical thinking and sometimes sharp and delusional whims or whims.”
In a speech to the Utah Bankers Association, Quarles warned that central bank digital currencies (CBDCs) could pose serious risks and would not solve any financial system problems. He reiterated his doubts about having CBDCs in the United States, and sought to calm what he perceived as over-enthusiasm: “Before we get swept up in the novelty, I think we need to know more about CBDCs.” The promises must be subjected to careful critical scrutiny.”
While there is a very high hurdle to overcome, given the potential costs and risks surrounding the security, Quarles said he would not judge the process initiated by the Fed to look at the potential of an official digital currency. “It would be an attractive target for cyber attacks and other security threats” or could be used to launder money, he pointed out. On the other hand, the main attraction of bitcoin is “something new and its anonymity”, he pointed out.
“By definition, the fads pass. Bitcoin and coins of that type will almost certainly remain a risk and a speculative investment, rather than a revolutionary form of payment,” Quarles concluded.