Jerome Powell, Federal Reserve Chairman has posited that the bitcoin is headed to displace the Gold, adding that the digital currency can’t replace the dominance of the dollar.
Powell made this assertion about bitcoin during a webinar talk on Monday sponsored by the Bank of International Settlements (BIS).
However, he cautioned that crypto assets, including bitcoin, are highly volatile and not useful as a store of value.
Powell said: “Crypto assets are highly volatile, see bitcoin and therefore are not really useful as a store of value. And, they are not backed by anything.
”They are more of an asset for speculation. They are also not particularly in use as a means of payment.
”It’s more a speculative asset. It’s essentially a substitute for gold, rather than for the dollar.
“The public needs to understand the risks. The principal thing is there’s volatility.
”There’s also the outsized energy requirement for mining, and the fact that they’re not backed by anything.”