#Economists oppose the Fed investing in Bitcoin.#
Hot Topic Overview
Overview
Recently, old-school economists in the United States have strongly opposed the proposal to allocate US reserve funds to Bitcoin. Steve Hanke, a professor at Johns Hopkins University, believes that shifting funds to Bitcoin could hinder economic growth because these savings are not invested in real capital assets, thus failing to improve productivity and ultimately dragging down economic development. He even called the idea of Bitcoin reserves "the stupidest idea." This opposition stems from Senator Cynthia Lummis's proposed "Bitcoin Act," which aims to establish a Bitcoin strategic reserve and purchase 1 million BTC. Currently, the debate over whether Bitcoin is a viable reserve asset continues, attracting widespread attention.
Ace Hot Topic Analysis
Analysis
Recently, old-school economists in the United States have strongly opposed the proposal to allocate US reserve funds to Bitcoin. Steve Hanke, a professor at Johns Hopkins University, believes that shifting funds to Bitcoin could hinder economic growth because these savings are not invested in real capital assets, while productivity improvements are crucial for improving living standards. He called the idea of Bitcoin reserves "the stupidest idea." This view stands in stark contrast to Senator Cynthia Lummis's proposed "Bitcoin Act," which aims to establish a Bitcoin strategic reserve and purchase 1 million BTC. At the heart of this debate is whether Bitcoin can serve as a viable reserve asset. Opponents argue that Bitcoin lacks intrinsic value and its price volatility is too high to serve as a stable reserve asset. Supporters, on the other hand, argue that Bitcoin's decentralized and censorship-resistant nature makes it a viable new reserve asset, offering investors more options. Currently, this debate continues, and the final outcome remains to be seen.