According to Yanis Varoufakis, former Finance Minister of Greece and Secretary General of MeRA25, Bitcoin and gold will not protect against geopolitical turmoil. “Finding freedom outside of government is a dangerous fantasy,” says Varoufakis.
“I do not believe that Bitcoin will replace traditional currency”
Varoufakis, “I do not believe that cryptocurrencies, such as Bitcoin, by definition of ‘oligarchy’, will replace traditional currency. It shouldn’t, it can’t, and it would be a nightmare if it did,” he says. However, he adds that Blockchain technology will be beneficial for central banks. Varoufakis has long advocated for a European Central Bank Digital Currency (CBDC). Responding to the concern that CBDCs could increase government bullying, Varoufakis says:
This is a serious concern. Concentrated power is never good for freedom. So I accept but also reject because apolitical money cannot exist. The only thing that gives value to money is its capacity to extinguish taxes. That is, we are like fish to the extent that we live in states that do things for us, sometimes against us, but still cannot live out of the water. We are citizens of states… we need those states.
Adding that the solution to government tyranny is democracy and transparency, Varoufakis said, “I say yes to those who say that the government can be dictatorial and limiting freedom. So we need democracy. So, for example, in the context of central bank digital currencies, I am a proponent of blockchain technology used to provide a degree of transparency so we all know how much money is in the system,” he says.
“Gold and Bitcoin are not hedging tools!”
Varoufakis says that when it comes to the claim that gold and Bitcoin are tools to hedge against government turmoil, it’s pure idiocy. “You have to control the money supply,” Varoufakis said. “The idea that the money supply should be independent of politics and government is very dangerous,” he says.
Continuing to explain that in times of crisis, the central bank should put money into use to avoid a depression, Varoufakis responds to claims that loose monetary policy can lead to inflation:
Financial ignorance. QE is not the reason we have inflation right now. For two reasons. First, because of the disruption of supply chains. There was a deadlock that essentially completely destroyed the supply chains of globalizing capitalism. The second reason is that there was a period when an increase in demand for goods coincided with a contraction in the supply of these things due to disruption of supply chains. This started the inflationary spiral.
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