Former New York Fed President: Establishing BTC reserves in the United States is not a good thing for the government and those who do not hold BTC.

Former New York Fed President Bill Dudley recently stated that establishing a BTC reserve in the United States is actually not beneficial for the government and people who do not hold BTC. (Background: Trump nominated Bensen as the US Treasury Secretary, what is his stance on Cryptocurrency and support for BTC reserves?) (Background: The Cryptocurrency Advisory Committee laid out by Trump will assist in establishing a US BTC reserve.) According to CoinGecko data, since Trump won the US election, BTC has surged by 31.6% in the past month, reaching a peak of over $100,000 on December 5, with a market capitalization surpassing Saudi Aramco, making it the world's seventh-largest asset. BTC trend. Image source: CoinGecko Former New York Fed President: Establishing a BTC reserve has no benefits However, former New York Fed President and former Vice Chairman of the Federal Open Market Committee Bill Dudley responded in a Bloomberg report yesterday (6th), stating that part of the recent rise in BTC is due to the optimistic prospect of the US establishing a BTC reserve under Trump's presidency. However, he believes that there are actually no benefits for the US in establishing a BTC reserve. Advantages of BTC First, Dudley affirmed the positive attributes of BTC. He believes that BTC is convenient, as holders can carry it with just a USB drive regardless of its price. Secondly, BTC also has partial Anonymity, allowing holders to transfer and trade without revealing any identity information or relying on any third-party institutions. Additionally, BTC can also combat inflation. Because the supply of BTC is designed to be 21 million, higher prices will not bring more supply, and increased demand will drive BTC to higher prices. No benefits in establishing a BTC reserve However, despite the above advantages of BTC, Dudley believes that establishing a BTC reserve has no benefits for the government or those who do not hold BTC: There is no exit strategy, as its purpose is to boost inflation rather than create value for the government. The government will be forced to hold volatile Tokens that do not generate any income. In order to provide purchasing funds, the Treasury Department must either borrow (increasing debt costs) or the Fed must print more US dollars (exacerbating inflation). The latter is hardly different from the Fed monetizing US government debt. Further reading: US Senator Lummis' BTC reserve bill is out, but where will the funds come from? Trump should enact secure regulations However, in the end, Dudley still suggests that if Trump truly wants to support the development of the Cryptocurrency industry, what is needed are secure regulations that allow Cryptocurrency to develop and operate safely. Dudley stated: For example, ensuring that stablecoins are fully backed by Fed deposits or short-term government bonds. Legislate to define whether Tokens are currency or securities, and who should regulate them. Establish rules to protect consumers and prohibit their use in financing terrorism or illegal drug sales, etc. encryption technology has the potential to improve the financial system, for example, making it easier and more cost-effective for people to conduct financial transactions. However, without robust safeguards, fraud and abuse will continue to exist, undermining the trust needed to establish these benefits. Related reports Tether is flush with cash! USDT Q2 net profit of $1 billion, BTC reserve increases to $1.67 billion US Senator Lummis' BTC reserve bill is out, but where will the funds come from? TRON transferred $100 million to "purchase BTC reserves"! Sun Yuchen: USDD mortgage rate has exceeded 200% This article was first published on BlockTempo, the most influential blockchain news media in BlockTrend.