Feds Waller calls crypto nothing more than a speculative asset

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Federal Reserve Governor Christopher Waller said on Friday that he views crypto as a speculative asset that is worth what the next person is willing to pay for it and said he personally would not hold it.

“To me, a crypto-asset is nothing more than a speculative asset, like a baseball card,” Waller said in a speech at a crypto conference at the Global Interdependence Center in La Jolla, La Jolla. California.

“If people want to own such an asset, then go for it,” Waller said. “I wouldn’t, but I don’t collect baseball cards either. However, if you buy crypto-assets and the price drops to zero at some point, don’t be surprised and don’t expect to what taxpayers socialize your losses.”

Waller said it was essential to ensure the risks associated with crypto are mitigated, but that regulators should not “unduly limit” the development and potential future uses of any positive characteristics of crypto.

Waller said any bank engaging with crypto clients would need to be very clear about clients’ business models, risk management systems and corporate governance structures to ensure the bank doesn’t get left behind. lags in the event of a crypto crash.

WASHINGTON, DC – FEBRUARY 13: Christopher Waller testifies before the Senate Banking, Housing, and Urban Affairs Committee during a hearing on their nomination as member designate of the Federal Reserve Board of Governors on February 13, 2020 in Washington , DC. (Photo by Sarah Silbiger/Getty Images)

When it comes to a central bank digital currency, Waller said, the main question is what is a flaw in the current US payments system that only a CBDC can solve. He said this question, it has not yet been answered.

“I haven’t been a big fan of the CBDC, Waller said. “That might be valuable in some countries. But for the United States, I just don’t see the value proposition for us.”

Waller’s comments come after the SEC on Thursday reached a settlement with crypto exchange Kraken over its staking program that will see Kraken pay a $30 million fine and shut down its crypto staking service for US customers.

Late last month, the Fed rejected Wyoming-based crypto bank Custodia’s application to become a member of the Fed system, noting that the bank’s focus on crypto created significant security and security risks. solidity and therefore did not meet the requirements of the law.

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The Fed also released a crypto policy statement last month, making it clear that uninsured and Fed-regulated insured banks will be subject to the same limits on activities, including crypto.

Banks would be allowed to provide custodial services for crypto-assets if done in a way the Fed considers safe and sound and in compliance with consumer and anti-money laundering laws silver.

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