Neel Kashkari, the President of the Federal Reserve Bank of Minneapolis, expressed skepticism about the real-world advantages of cryptocurrencies and stablecoins in facilitating international money transfers during a recent panel discussion.
Kashkari dismissed claims made by cryptocurrency proponents as mere “empty rhetoric,” asserting that these digital assets lack genuine practical applications.
To highlight his doubts, Kashkari presented examples during the panel. He acknowledged that traditional bank transfers tend to be slow and costly but challenged the notion that stablecoins effectively address these issues. He illustrated this with a scenario: “Consider someone in the United States sending funds to a family member in the Philippines for everyday expenses. Conventional methods are expensive and sluggish. Advocates say stablecoins enable instant delivery to Manila.”
Yet, Kashkari pointed out flaws in this argument: “Even if it arrives instantly, you still need to convert it into local currency. Proponents then argue that merchants also accept stablecoins. Essentially, they suggest everyone worldwide should adopt one currency or eliminate all transactional frictions — which is unrealistic.”
Kashkari emphasized he posed what he believes is a critical question regarding crypto and stablecoin utility: “Provide me with an example where consumers benefit beyond illicit activities like drug transactions.” He characterized responses as incoherent jargon or “word salad,” concluding there was no substantive evidence supporting their usefulness.
This perspective aligns with broader Federal Reserve skepticism toward digital currencies. Kashkari has previously labeled cryptocurrencies as entirely pointless and primarily speculative instruments rather than viable financial tools.
*This content does not constitute investment advice.*