Bitcoin danger from the USA? – Treasury Secretary Janet Yellen warns against BTC
It is done: The Bitcoin share price has surpassed its previous all-time high. Parallel to this, media attention is also increasing & more and more news portals are reporting on the Crypto Bull crypto currency again. Meanwhile President-Elect Joe Biden has confirmed that Janet Yellen will be his new Minister of Finance.
Yellen served as Chairman of the Federal Reserve (FED) from 2014 to 2018, and from a crypto-perspective, Bitcoin may be in danger, as the now nominated Secretary of the Treasury is not a fan of the crypto currency.
Is Bitcoin threatened with strict regulation in the USA?
I am not a fan of Bitcoin. It is not a stable store of value or legal tender.
These words were chosen by Janet Yellen at a press conference in 2017, when she was still chairman of the Federal Reserve. The conference took place in December 2017, so the comments were directly related to the Bitcoin Bullrun that was taking place at that time.
Furthermore, Yellen said:
Bitcoin is a highly speculative asset.
Now such statements are undoubtedly not an expression of affection for Bitcoin. However, we must also consider the statement in a temporal context:
After Bitcoin rose from USD 1,000 to USD 20,000 in 2017, it is perfectly legitimate to say that it is a speculative asset. Especially considering the fact that at that time the fundamental values were weaker than today.
In addition, the then Bitcoin Bullrun was largely supported by private investors. From today’s perspective, the environment is different and the strong acceptance of the crypto currency by institutional investors has also changed the fundamental data.
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Paradigm shift in the US government?
However, it remains difficult to predict how the Biden administration will react to Bitcoin and crypto currencies.
Two years ago, in 2018, Yellen still spoke negatively about Bitcoin. In this context she criticised the crypto currency for all „illegal transactions“ that could be made with it.
With regard to the acceptance of Bitcoin, there are undoubtedly two camps: while some see a niche in BTC, there are several proponents who understand the advantages of the crypto currency.
One example is Niall Ferguson, who wrote a clear plea for Bitcoin in a Bloomberg column. In that column, he explicitly advocated integration into the US financial system:
Joe Biden’s young administration should understand the advantages of Bitcoin and integrate the crypto currency into the US financial system.
From our perspective, such a scenario is rather unlikely. Despite the adoption of providers such as PayPal, MicroStrategy or even hedge funds, rejection in government circles is still high.