David Andolfatto, Vice President of the Federal Reserve Bank of St. Louis released a PDF presentation that discusses Bitcoin in depth. In it, he covers the positives and the negatives related to Bitcoin and cryptocurrencies.
The presentation is suprisingly in-depth coming from an official so high up within the Federal Reserve.
Even more surprising is his favorable outlook of Ripple within the last 5 pages of the presentation.
- The effect of this and similar rulings serve to diminish the attractiveness of bitcoins as a currency. (Ripple a winner?)
- Well-run central banks should welcome the emerging competition.
- There is (in my view) room for beneficial coexistence; for example:
- A politically independent Fed operating an “elastic” currency supply with congressionally assigned mandates (e.g., price-level stability).
- Together with Ripple, a currency-agnostic P2P payment system to facilitate low-cost payments.
You can see the presentation for yourself, titled Bitcoin and Beyond: The Possibilities and Pitfalls of Virtual Currencies