Janet Yellen may be open to US regulators considering cryptocurrencies, but she still seems to have strong concerns about Bitcoin (BTC).
On Monday, Yellen said in an interview with the DealBook DC Policy Project column of The New York Times that the Fed’s research on the crypto dollar makes sense. Yellen said in a conversation with Andrew Ross Sorkin, chief reporter of The New York Times, that the crypto dollar issued by the Federal Reserve may bring “faster, safer, and cheaper payment methods.” But she added that there are “many things to consider” before a crypto dollar can be launched. She questioned how regulators will “manage money laundering and illegal financing” and the impact of crypto dollars on banks and the Federal Reserve.
In addition, the finance minister also criticized Bitcoin as a medium of exchange, and did not mention its use as a store of value:
“I don’t think Bitcoin will be widely used as a trading mechanism. This is an extremely inefficient way of trading, and the energy used to process these transactions is amazing.”
Yellen talked about cryptocurrency and Bitcoin before taking the oath of office on January 26. In her hearing to confirm her role as Secretary of the Treasury, she called cryptocurrency “a growing concern” in the United States, and this concern “mainly comes from illegal financing.” In a subsequent written statement, she reiterated her view of linking crypto assets with illegal financing, but the statement also mentioned her plan to encourage the US government to use crypto assets for “legal activities.”
Yellen was the first woman to serve as Secretary of the Treasury of the United States. She was nominated by former US President Barack Obama as the chairman of the Federal Reserve in 2013 and left her post in early 2018. Yellen once called Bitcoin “useless”, but before being nominated as Treasury Secretary by the current US President Joe Biden, she remained largely silent on cryptocurrency and blockchain.