In a scathing critique at the 2026 Midwest Economic Outlook Summit, Federal Reserve Bank of Minneapolis President Neel Kashkari lambasted cryptocurrencies, labeling them as ‘utterly useless’ and offering little to no practical value to consumers or businesses. Speaking in Fargo, North Dakota, Kashkari contrasted the burgeoning field of artificial intelligence (AI), which he views as a transformative technology with clear, everyday applications, against the largely speculative nature of digital assets.
Crypto’s Lack of Practical Value
Kashkari’s remarks underscore a growing skepticism among policymakers regarding the utility of cryptocurrencies. ‘Crypto has been around for more than a decade, and it’s utterly useless,’ he stated, according to Bloomberg. ‘While AI has demonstrated clear benefits for both consumers and businesses, the same cannot be said for crypto.’
Stablecoins: No Better Than Venmo
The Fed official also dismissed the claims that stablecoins, a type of cryptocurrency pegged to the value of traditional currencies, offer significant improvements over existing payment systems. ‘I can send any one of you $5 with Venmo or PayPal or Zelle,’ he said during a Q&A session. ‘So what is it that this magical stablecoin can do?’
Kashkari acknowledged that stablecoins might make cross-border transfers faster and cheaper, but he pointed out that recipients must still convert these digital tokens into local currency for everyday purchases, adding friction and cost. ‘Advocates have yet to present a compelling use case for U.S. consumers,’ he emphasized.
Defending the Fed’s Independence
Beyond his critique of digital assets, Kashkari addressed the broader issue of the Federal Reserve’s independence. He responded to criticism from National Economic Council Director Kevin Hassett regarding a New York Fed study on tariffs, calling it ‘another step to try to compromise the Fed’s independence.’ Kashkari highlighted that over the past year, there have been multiple attempts to undermine the Fed’s autonomy, including a December subpoena from the Department of Justice to the Board of Governors related to building expenses.
Central bank independence, Kashkari argued, is crucial for effective monetary policy. ‘Every advanced economy in the world has an independent central bank,’ he said. ‘Policy decisions serve the public best when based on data and analysis rather than short-term political considerations.’
Economic Outlook and Policy Stance
On the economic front, Kashkari noted that inflation has eased to between 2.5% and 3%, while unemployment has risen from around 3.5% to 4.3%. He stated that the Fed is ‘pretty close to neutral’ after cutting interest rates multiple times over the past two years. This stance reflects a cautious approach to balancing economic growth and price stability.
Crypto’s Parallel to the Beanie Babies Bubble
Last November, Kashkari drew a parallel between the crypto sector and the 1990s Beanie Babies bubble, arguing that it still lacks meaningful economic use. ‘I’m more confident in the utility of AI, which I see as delivering real economic value, whereas crypto fails to demonstrate a compelling purpose,’ he said on CNN. He questioned the everyday use of digital assets in the U.S., noting that the primary application he hears is to bypass banking regulations like know-your-customer and anti-money-laundering rules—a use he described as ‘lousy’ for a Federal Reserve policymaker.
As the debate over the role of cryptocurrencies in the financial system continues, Kashkari’s comments highlight the ongoing skepticism from key regulators. While the crypto industry seeks to innovate and find real-world applications, it faces significant hurdles in proving its value to policymakers and the broader public.
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