In an interview with Sheila Bair, the former director of the US Federal Deposit Insurance Corporation (FDIC) has reiterated that cryptocurrencies should not be banned. Bair, who served as FDIC chair under both Presidents George Bush and Barack Obama from 2006-2011 has previously been ranked by Forbes as the world’s second most powerful woman after German chancellor Angela Merkel.
The FDIC is a US federal government agency that provides insurance to bank deposits. In a surprising admission from high-profile former official she has said that Bitcoin is similar to US dollars in that is lacks “intrinsic value”.
“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.”
In an opinion that mirrors some of the prominent figures in crypto such as Nick Szabo, Bair has expressed similar opinions on cryptocurrencies in the past, arguing that the value of ‘money’ has always relied “more on psychology than physical attributes”.
Among other roles, Bair is now a member of blockchain startup Paxos’ board of directors.
Bair’s endorsement of bitcoin goes hand-in-hand with her suggestion that authorities should bring regulation that focuses on “good disclosure, education, warding off fraud and making sure it is not used for illegal activities.”
“Let the market figure out what it’s worth. That is what it is doing now.”