Cryptocurrencies see more than their fair share of negative comments, which is why it is always welcomed whenever they get even a tiny bit of positivity from an authoritative figure.
The recent instance of such a kind came in the form of comments from Sheila Bair, former chair of the U.S. Federal Deposit Insurance Corporation (FDIC), who mentioned that while Bitcoin is not her recommended choice of investment at the moment, banning it altogether would not be a good move by the authorities either.
These comments hold significant weight, since Bair had been at the forefront when the government had been dealing with the 2008 financial crisis, and thus holds experience in identifying and resolving financial risks.
Bair thinks that bitcoin’s speculative value should not be held against it
While speaking to Barron’s, Bair shared her two cents on Bitcoin and the way that it gets negative publicity for driving its value purely from speculation rather than being backed by any asset or government.
Her comments explained that while it is true that Bitcoin’s value is purely speculative, it is not a good enough reason to stop its operations, because if that is the case, then fiat such as dollar could be held under the same standards as that is how the function works for any currency.
“Don’t put any money into bitcoin that you can’t afford to lose. But I don’t think we should ban it — the green bills in your pocket don’t have an intrinsic value, either. The value is based on what others think is its value. That’s true of any currency.”
While her comments allude towards her stance about a ban not being a proper resolution to the issue, her clear explanation on what any future regulations should focus on making it clear that she thinks that cryptocurrencies should get a fair chance, while also ensuring that their investors remain protected.
“Regulation should be focused on good disclosure, education, warding off fraud, and making sure it is not used for illicit activities.” She continued.
“Let the market figure out what it’s worth. That is what it is doing now.” She concluded.
This points to the fact Bitcoin does have chances of survival
While notable figures that currently serve as heads of central banks and financial arms of major countries take a firm stance against Bitcoin; Bair, who had been in Time magazine’s list of 100 Most Influential People in 2009, actually does not hold a negative view against this financial phenomenon.
This is possibly a very good thing in itself.
Although Bair has not been active on the financial markets in recent years, this goes on to show that Bitcoin – if it works to maintain its status as one of the prime cryptocurrencies – could actually turn things around for itself by holding itself together and showing its signature resilience for a few more years.
These comments are not driven by naive optimism either. Goldman Sachs, which initially held a negative stance against Bitcoin, reportedly started looking into setting its own division to entertain cryptocurrency transactions. Most recently, one of its funded companies, Circle, acquired Poloniex, one of the largest cryptocurrency exchanges in the world.
Who knows, maybe with some time, more people with the stature of Bair and firms the likes of Goldman Sachs could turn around and start supporting cryptocurrencies, or at the very least, stop speaking against them.