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News Link • Cyberspace and the New Economy

Crypto Carnage Continues As The Fed Warns Digital Currencies Could "Pose Serious...

• by Tyler Durden

Today, the vast majority of our payments by volume and value are processed by regulated financial institutions. In the U.S. payment system, digital currencies are a niche product that sometimes garners large headlines.

While these digital currencies may not pose major concerns at their current levels of use, more serious financial stability issues may result if they achieve wide-scale usage.

Perhaps most ironic is Quarles' description of the 'drawbacks' of cryptocurrencies...

But from the standpoint of analysis, the "currency" or asset at the center of some of these systems is not backed by other secure assets, has no intrinsic value, is not the liability of a regulated banking institution, and in leading cases, is not the liability of any institution at all. Indeed, how to treat and define this new asset is complicated.

1 Comments in Response to

Comment by Ed Price
Entered on:

If any of the billionaire, Bilderberg people seriously feared Bitcoin, the thing they would do is buy up all the bitcoins. They would get together, and do it in organized fashion, so none of them would bear too much of the burden. Sure, the price would go up, but as the price went up, these people wouldn't lose any value. So what if a few Bitcoin miners or other people become rich off this move? If the Bilderbergers never sold, most of the bitcoins would eventually go to them. Bitcoin would never become a serious currency. The point is, either Bitcoin is something the wealthy need not fear, or the smart money people, the Bilderbergers, are "dumber" than we thought.

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