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Bitcoin "is not a rational money," does not mean it's useless: Greenspan, former Fed chairman

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Alan Greenspan, former chairman of the Federal Reserve, said that bitcoin has many similarities with dollars Continental printed by the US Congress during the war. Independence to finance the war against Britain.

Greenspan, who chaired the Fed from 1987 to 2006, told CNBC that Bitcoin is a classic example of fiat currency because it creates value from nothing but consumer demand. In this sense, it is quite similar to the mainland dollars that George Washington and other US leaders used to buy weapons and other supplies during the war.

"A significant part of this work was to create real goods and services," said Greenspan, despite the fact that it was worthless because it was not supported by material goods and that Congress continued to devalue it.

Similarly, he said, bitcoin is "not a rational currency," but that does not mean it's worthless.

"Bitcoin is really a fascinating example of how human beings create value, or value or value," Greenspan said. "And it's not always rational, you can not tell me that you can create something that has a means of exchange out of nothing." It's not a rational money in this way. meaning, but that does not mean that it will not be exchanged, because as long as people believe they can sell it to someone else or unload it on someone else 's d & # 39; other, it is all that it takes to create a market.

Perhaps betraying his ignorance of the underlying technology of cryptocurrency, Greenspan said that the future of bitcoin depended on the number of currency units that its issuers brought to the market . Of course, as the most casual Bitcoin users know, the Bitcoin currency supply is programmed into the software protocol and will enter the market at a predictable rate until it reaches a ceiling of 21 million pieces.

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But even if bitcoin turned out to be basically worthless, Greenspan said it would not necessarily drop the price to zero because humans do not always behave rationally.

"Humans buy all kinds of things that are worthless," concluded Greenspan. "People play in casinos when the odds are against them – he has never stopped anyone."

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