• Federal Reserve Bank of Minneapolis President Neel Kashkari reiterates his longstanding skepticism of cryptocurrency, calling it "basically useless" for consumers due to lack of practical applications, volatility, and complexity.
  • His remarks, made during a virtual policy forum in early 2026, highlight crypto's failure to gain meaningful adoption, with only 8% of U.S. adults using it for purchases and 72% holding it speculatively.
  • Kashkari's critique comes amid regulatory scrutiny and contrasts with his optimism about AI's economic utility, sparking fresh debates on financial stability versus innovation.

Neel Kashkari, the President of the Federal Reserve Bank of Minneapolis, has sharpened his criticism of cryptocurrency, labeling it "fundamentally useless" for consumers in advanced economies. Speaking at a virtual policy forum in early 2026, Kashkari pointed to crypto's lack of practical applications, persistent volatility, and technical barriers as key shortcomings. "What we've seen is a lot of hype without real utility for everyday people," he said, according to people familiar with his remarks. Efforts to reach Kashkari for additional comment were unsuccessful.

His skepticism isn't new—dating back to 2018 when he called crypto a "farce"—but the latest comments underscore a growing regulatory caution. Kashkari cited data showing that only 8% of U.S. adults use cryptocurrency for purchases, while 72% hold it speculatively. Security risks also loom large, with 33% of non-users deterred by theft and fraud concerns, and 41% citing complexity as a barrier. "In an economy with stable payment systems, crypto adds little value," he argued, contrasting it with AI's tangible benefits in testing and applications.

Market trends haven't helped crypto's case. Despite occasional rallies, transaction volumes remain low outside speculative trading and illegal activities, and the 2022 crash is viewed by Kashkari as a positive development that reduced systemic risks. His stance aligns with broader shifts favoring AI over crypto for economic utility, amid U.S. economic growth forecasts and cooling inflation. Regulatory frameworks are fragmented, with Kashkari praising SEC crackdowns on fraud and urging Congress to handle crypto regulation, unlike clearer regimes in the EU or Japan.

Industry pushback is inevitable. Kristin Smith, CEO of the Blockchain Association, has pointed to emerging use cases like cross-border payments and digital ownership, predicting gradual adoption as technology improves. But Kashkari's influence, rooted in his 2008 Treasury experience emphasizing stability, may bolster calls for stricter consumer protections. The Fed's own research into central bank digital currencies further distinguishes public digital money from private crypto, adding to the complexity.

Looking ahead, Kashkari's remarks could delay regulatory clarity and adoption in the short term, even as layer-2 solutions aim to improve scalability. Long-term, crypto's utility might grow with tech advances and merchant acceptance, but for now, the debate rages on. As one analyst noted, "It's a classic clash between innovation and proven systems—and Kashkari isn't backing down."