Mr. Williams, the nominee to head the New York Federal Reserve, has declared that “Cryptocurrency doesn’t pass the basic test of what a currency should be.” Mr. Williams stated that currencies should comprise “basically something with a store of value,” also underlining the necessity for currencies to be “elastic” in order to accept to a wide range of economic conditions and circumstance. Despite the criticisms, Mr. Williams did not manage to further elaborate on how cryptocurrencies fail to or could better fulfill the above-mentioned monetary functions.
The idea of the supply of currency and thinking about currency really belongs more in the sphere of government and central banks. My view is it’s really more of a promise of technology.
John Williams, the president and chief executive officer, San Francisco Federal Reserve Bank
Mr. Williams also claimed that the cryptocurrency sphere suffers from “problems with fraud, problems with money laundering, terror financing.” Mr. Williams is to be appointed as the head of the New York Federal Reserve Bank in June when the current president, William Dudley, will step away from the stance.
Mr. Williams’ statements come following weeks of heavily hostile rhetoric issued representatives of various federal reserve banks in the United States.
At the beginning of April, Federal Reserve Board of Governor member, Lael Brainard, pointed out that the institution is “monitoring is the extreme volatility evidenced by some cryptocurrencies.”
Also the president and chief executive officer of the Federal Reserve Bank of Atlanta, Raphael Bostic, at the end of March refused the proposition that cryptocurrencies lke Bitcoin comprise money. Mr. Bostic discouraged consumers from investing in the virtual currency markets.
In January, the president of the Federal Reserve bank of Chicago, Charles Evans, claimed that bitcoin is “Not money-like at the moment,” adding that the investors in cryptocurrency are “swimming with all the sharks in the world because of all the anonymity.’’