Senior Federal Reserve official: 95% of cryptocurrencies are fraud and hype, and Bitcoin is useless

Minneapolis Federal Reserve President Neel Kashkari on Tuesday delivered a scathing critique of the nascent crypto asset market.

Kashkari said he believes bitcoin, the world’s largest cryptocurrency, has no use and that the broader digital asset industry is mostly associated with fraud and hype.

“Crypto is 95 percent scam, hype, noise and confusion,” Kashkari said at the annual Pacific Northwest economic region summit.

Cryptocurrencies have gained favor with institutional investors in 2021, but they are still seen as speculative and high-risk transactions compared to traditional markets.

Kashkari also offered some thoughts on monetary policy plans, noting that he still sees “very soft” in the U.S. labor market and suggesting more strong jobs reports might be needed before he would lean toward scaling back the Fed’s $120 billion in monthly purchases of Treasuries and mortgage-backed securities.

Kashkari said it would be reasonable to start reducing bond purchases by the end of 2021 if the job market cooperates.