Federal Reserve Chair Jerome Powell holds a news conference following the Federal Reserve’s two-day Federal Open Market Committee Meeting in Washington, July 31, 2019.

Sarah Silbiger | Reuters

Cryptocurrencies are largely for making bets on price increases and haven’t reached the status of payment mechanisms, Federal Reserve Chairman Jerome Powell said Wednesday.

“They’re really vehicles for speculation,” the central bank leader told The Economic Club of New York in a virtual interview with David Rubenstein, co-founder of the Carlyle Group. “They’re not really being actively used as payments.”

Powell compared crypto to gold.

“For thousands of years, human beings have given gold a special value that it doesn’t have” as an industrial metal, he said.

The comments came the same day Coinbase went public in a direct listing on the Nasdaq, an exchange that is weighted with tech companies.

Coinbase is the predominant exchange for trading bitcoin and other cryptocurrencies. It opened at $381 a share, well above its $250 reference price. The company said it generated $1.8 billion in revenue for the first quarter amid wild price gains for bitcoin, ethereum and other crypto names.

Powell’s predecessor at the Fed, Janet Yellen, is now Treasury secretary. In February, she told CNBC that she views bitcoin as “a highly speculative asset” and said it is not “widely used as a transmission mechanism” and is an “extremely inefficient way of conducting transactions.”

Along with a brief chat about crypto, the Powell interview encompassed
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