Fed Official Brands Crypto "Utterly Useless" on February 19
Speaking at the Midwest Economic Outlook Summit in Fargo, North Dakota, on Thursday, Minneapolis Federal Reserve President Neel Kashkari delivered a scathing assessment of the digital asset industry. He declared that after more than a decade, cryptocurrencies have failed to demonstrate any meaningful real-world application. Kashkari contrasted the sector with artificial intelligence, which he noted has "real long term potential for the U.S. economy."
Crypto has been around for more than a decade, and it's utterly useless.
— Neel Kashkari, President of the Federal Reserve Bank of Minneapolis.
To illustrate his point, Kashkari surveyed the audience, asking how many had used AI tools like ChatGPT recently versus how many had used bitcoin for a transaction. His comments underscore a persistent skepticism within parts of the U.S. central bank regarding the intrinsic value and economic function of cryptocurrencies.
Stablecoins Derided as "Buzzword Salad"
Kashkari directed specific criticism toward stablecoins, which are often promoted as a bridge between traditional finance and digital assets. He questioned their purported benefits over established payment systems, famously asking, "What can I do with the stablecoin that I can't do with Venmo today?" Labeling the concepts a "buzzword salad," he argued that even for cross-border payments, the advantages are overstated.
While acknowledging their rising adoption in emerging markets, Kashkari pointed out that the practical hurdles remain significant. He noted that recipients must still convert stablecoins into local currency for everyday purchases, a process that can be costly and inconvenient, undermining the promise of frictionless transfers.
Kashkari's dismissive stance creates a clear policy divergence with the Trump administration, which has actively embraced digital assets. Treasury Secretary Scott Bessent has publicly advocated for regulated, dollar-backed stablecoins as a mechanism to extend the U.S. dollar's global dominance.
This clash is further exemplified by President Trump's March 2025 executive order to establish a strategic Bitcoin reserve, a move intended to bolster U.S. financial influence. The conflicting signals from a key Federal Reserve official and the executive branch introduce significant uncertainty for investors and companies navigating the regulatory landscape for digital assets in the United States.
