Fed Official Dismisses Crypto as ’Basically Useless’ While AI Remains in Testing Phase
Neel Kashkari, President of the Minneapolis Federal Reserve, just threw cold water on the crypto hype train—calling digital assets "basically useless" in a recent public appearance. Meanwhile, he noted artificial intelligence remains largely experimental across most business sectors.
The Crypto Critique
Kashkari's comments land like a regulatory hammer on an already volatile market. He framed cryptocurrencies as solutions searching for problems—questioning their real-world utility beyond speculative trading. No new data points emerged from his remarks, just the same skepticism central bankers have voiced for years.
AI's Slow March
While dismissing crypto, Kashkari acknowledged AI's potential but emphasized most implementations remain in testing phases. Businesses are experimenting, not deploying—suggesting the technology's transformative impact might be further out than headlines suggest. Another case of Wall Street getting ahead of actual adoption curves.
The takeaway? Traditional finance gatekeepers still view crypto as digital casino chips while treating AI as promising but unproven tech. For investors chasing the next big thing, it's a reminder that regulatory skepticism often trails innovation—and sometimes catches up.
Kashkari rejects QE, says crypto has no consumer use
On monetary policy, Kashkari made it clear that he doesn’t think the Fed’s current strategy is loose. He pushed back at the idea that recent balance sheet growth is another round of quantitative easing.“I don’t see a need for quantitative easing,” he said.
Just because the balance sheet is expanding doesn’t mean it’s QE, he argued.
Talking tariffs, Kashkari said the effects on prices haven’t been as bad as expected. But he warned that another price hit from new tariffs is possible. “They haven’t been the gut punch many feared,” he said, “but their long-term impact is still unfolding.” That part remains a question mark.
He also mentioned unemployment is dropping, which he welcomed. But he reminded everyone that the Fed has to balance both sides of its job; price control and employment. “They’re in tension with each other,” Kashkari said. That tension makes the job harder. As for consumers, he said people are still doing okay financially.
“Households have pretty good balance sheets,” and nothing looks “very alarming” in terms of borrowing. The real issue has been inflation, according to him.
Switching gears, Kashkari addressed technology. He said AI is mostly still in the test phase inside companies. It hasn’t led to major layoffs yet. He also dismissed cryptocurrency entirely. “It’s basically useless” for regular people, he said, with no hesitation.
On housing, he didn’t comment on Trump’s plans for mortgage bonds. But he did point to a bigger issue: supply. “That’s the biggest barrier” in housing, according to him.
He wrapped it all up by defending the Fed’s independence. “We all believe an independent central bank makes the best policy,” Kashkari said. He added that officials will keep making decisions based on what’s best for the country.
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