Former Fed Regulator Urges Complete Ban On Bitcoin, Claims Crypto Has No Actual Value
Former New York Federal Reserve Bank employee and current head of Duke University’s Global Financial Markets Center Lee Reiners think cryptocurrencies shouldn’t be allowed into the banking system since they don’t generate any cash flow.
Lee Reiners is among the several detractors of cryptography. Reiners, who is advocating for a ban on bitcoin, has said that Crypto has no inherent value and trades primarily on feeling and that digital assets lack fundamentals.
Reiners argues that the current bear market that has afflicted the cryptocurrency market is merited, pointing out that the claim that cryptocurrencies are an effective hedge against inflation is false, given the timing of the cryptocurrency market crash.
Reiners contends that the value of cryptocurrencies, particularly Bitcoin, has increased in recent years owing mostly to ineffective monetary policies enacted by the Federal Reserve during the epidemic, and not because of the intrinsic worth of Crypto.
To substantiate his claim, he cited the recent crypto winter that has lasted for an extended period of time, noting that the current crypto fall is predicted due to recent Fed actions revealing the true worth of digital assets.
Reiners has not been Crypto’s greatest supporter
Reiners has also said that he thinks proponents of cryptocurrencies are not seeking clear laws, but rather lax rules that might foster the growth of cryptocurrencies.
“Crypto guys say, ‘Oh, we simply want regulatory clarity,'” he said. Okay, I respond, it’s rather apparent in China, but it’s likely not the clarity you’re seeking. The phrase “we want regulatory clarity” is a euphemism for “we want favourable legislation with a light hand.”
Reiners continued by stating that blockchain technology has no exceptional value. Since Bitcoin’s inception in 2009, he’s been looking for a “killer use case” but hasn’t found anything spectacular. “When it comes to blockchain, it’s actually not superior at anything,” he said, adding that he’s been waiting for a “killer use case” since then.
Reiners has not been Crypto’s greatest supporter. Reiners said in his September 2021 essay “Bitcoin and the State: An Unholy Alliance” that cryptocurrency is a “poor medium of trade and unit of account” owing to its volatility and that its sole demonstrated purpose is as a form of speculation.