Fed Official Calls Bitcoin 'Utterly Useless' While Trump Builds Strategic Reserve

$66,510. That's bitcoin's price right now. But according to a top Federal Reserve official, that number might as well be zero.

The Fed vs. The White House

Neel Kashkari didn't mince words at the Midwest Economic Outlook Summit in Fargo, North Dakota. "Crypto has been around for more than a decade, and it's utterly useless," the Minneapolis Fed president declared. His test was simple: he asked the audience who had used ChatGPT or Gemini recently—many hands went up. Then: "Who's bought or sold something with bitcoin?" Crickets.

Meanwhile, the Trump administration is betting big on the opposite thesis. The president signed an executive order creating a strategic bitcoin reserve, while Treasury Secretary Scott Bessent argues that regulated stablecoins can extend the dollar's global dominance.

The 'Why Not Just Use Venmo?' Challenge

Kashkari's stablecoin skepticism cut deep. "What can I do with a stablecoin that I can't do with Venmo today?" he asked. When pressed on cheaper cross-border payments, he countered: "You still need to convert to local currency to buy groceries, and that conversion isn't free."

It's a fair point. Try buying coffee with bitcoin in most American cities—you'll be searching for a while. Even Starbucks, which once accepted crypto payments through partnerships, quietly moved away from the experiment.

AI vs. Crypto: The Utility Test

Kashkari's comparison between AI and crypto reveals a stark contrast in adoption curves. OpenAI's ChatGPT reached 100 million users in just two months, while bitcoin payments remain largely theoretical for most Americans. "AI has real long-term potential for the U.S. economy," he argued.

Yet emerging markets tell a different story. In countries like Argentina and Turkey, where local currencies face double-digit inflation, bitcoin and stablecoins are finding genuine utility. Kashkari acknowledged this but maintained that "technical problems" persist.

The Philosophy Behind the Split

This isn't just about technology—it's about competing visions of America's financial future. The Fed prioritizes stability and proven utility. The Trump administration sees crypto as a strategic weapon to maintain dollar hegemony in an increasingly multipolar world.

Coinbase shares have surged over 300% since Trump's election, but Fed officials remain unmoved by market enthusiasm. The central bank's mandate is financial stability, not innovation for its own sake.

Following the Money

Here's what's interesting: while Kashkari dismisses crypto, the Fed is actively researching a digital dollar. Meanwhile, BlackRock's bitcoin ETF has attracted over $30 billion in assets. Someone's betting wrong—but who?

For everyday Americans, the disconnect is jarring. Your government is building a bitcoin reserve while your central bank calls it worthless. Your 401(k) might include crypto ETFs that a Fed president considers "buzzword salad."