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Christopher Waller praised the emerging applications of distributed ledger technology, astute contracts and tokenization, but helium changed his tune for crypto assets.
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The parts that marque up the cryptocurrency ecosystem are not each equal, United States Federal Reserve Board politician Christopher Waller told a league assemblage connected Feb. 10. He had wide preferences among the 3 elements of the ecosystem that helium identified.
Waller was hosted by the Global Interdependence Center astatine its “Digital Money, Decentralized Finance, and the Puzzle of Crypto” conference. He considered crypto assets, blockchain exertion and trading technology, specified arsenic astute contracts and tokenization, separately.
Waller focused connected the broader applications of crypto technology. Research connected applications of distributed ledger exertion to “a wide scope of information absorption problems” is underway. Smart contracts tin beryllium applied to non-crypto assets, and tokenization, combined with information vaults, tin support privateness without promoting wealth laundering. Further, Waller said:
“While these technological developments are inactive successful their infancy, they person imaginable applications beyond the crypto ecosystem that could pb to important productivity enhancements successful different industries.”The bulk of Waller’s speech was devoted to crypto assets. He compares crypto assets, which helium said person nary intrinsic value, to a commodity – maize – and utilized economical mentation to explicate that intrinsically valueless objects whitethorn beryllium traded astatine a affirmative terms owed to the "the societal contrivance of money." But determination is an inherent problem, helium added:
“What if 1 day, beliefs alteration and I nary longer judge that idiosyncratic volition wage maine for this entity successful the future? Then I intelligibly shouldn't wage thing for it today, truthful its terms goes to zero. […] However, if you bargain crypto-assets and the terms goes to zero astatine immoderate point, delight don't beryllium amazed and don't expect taxpayers to socialize your losses.”Even sophisticated, organization investors person mislaid wealth successful the crypto winter, Waller noted.
A wide thought of the differences betwixt the parts of the crypto ecosystem volition assistance guarantee that regularisation volition mitigate the risks of crypto assets without impeding innovation of “the affirmative features of the crypto ecosystem,” helium concluded.
Waller has previously expressed his cynicism astir a U.S. cardinal slope integer currency.
Fed Governor Waller happens to beryllium speaking successful La Jolla contiguous astir crypto banking. KYC/AML "they successful nary mode are allowed to ignore" $SI $SBNY pic.twitter.com/VeY5G9eiPD
— AV (@AureliusValue) February 10, 2023
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