Former FDIC Chair Says ‘We Don’t Ban Assets,’ Bitcoin Just Needs To Be Regulated

Former FDIC Chair Says ‘We Don’t Ban Assets,’ Bitcoin Just Needs To Be Regulated

Sheila Bair, former US Federal Deposit Insurance Corporation (FDIC) chair, told CNBC’s “Fast Money” on Friday, Jan. 19 that there is no precedent to ban Bitcoin (BTC) as an asset, but there is a need for additional regulation of digital currencies.Bair had previously written a December 2017 op-ed on Yahoo along the same theme of more regulation without any bans against BTC.In the “Fast Money” interview Friday, Bair reiterated that while, “we don’t ban assets,” regulating crypto markets is necessary to prevent both money laundering and the potential for market manipulation.Bair looks favorably on CBOE and CME’s recent releases of Bitcoin futures contracts, saying:

“I think that the fact that CME and CBOE launched futures actually could help because that will actually also give them [government regulatory bodies] a window into providing, getting more reporting from the underlying Bitcoin exchanges that are feeding prices into their futures products. It will give the CFDC a window and some information to make sure there’s no manipulation going on.”

Bair’s current main concern with Bitcoin is that the public may be attracted by the promise of high returns and begin investing in Bitcoin and other digital currencies without a clear understanding of what these products are.In regards to the public’s overall understanding of cryptocurrencies, Bair says:

“I think there’s a lot of confusion between Bitcoin and blockchain technology.”

Bair currently serves on the board of Paxos, a fintech company working with Blockchain technology. She noted during the CNBC interview that she does not own Bitcoin.