Robin Brooks, the chief economist at the Institute of International Finance (IIF), has labeled Bitcoin (BTC) a "pointless asset," attributing its market movements to Federal Reserve policies rather than its intrinsic value.
This statement comes amidst Bitcoin reaching a new high of $38,437 on the Bitstamp exchange, its highest level since May 2022, driven by the resolution of the Binance legal saga and the anticipation of "spot bitcoin" ETFs.
Not an independent asset?
Brooks' assertion that Bitcoin is akin to "just another futures contract on the Fed" implies that the cryptocurrency's value and market behavior are heavily influenced by the Federal Reserve's monetary policies rather than its own fundamentals.
This perspective challenges the commonly held view of Bitcoin as a decentralized and independent asset.
According to Brooks, investors might be better served by directly engaging with futures contracts that bet on the Fed's moves. He suggests that Bitcoin's movements are a mere reflection of broader economic policies rather than an asset with standalone merit.
Brooks's past criticism of Bitcoin
The prominent economist has consistently stressed the flagship cryptocurrency's correlation with the Fed's interest rate policies in his social media posts. His view is supported by the fact that the Bitcoin price falls when the Fed adopts a hawkish stance and rises with a dovish outlook.
Brooks has also dismissed the idea of Bitcoin as a store of value or a means of diversification. He has previously labeled it a "bubble asset" that is vulnerable to shifts in monetary policy.