Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, recently reiterated his staunch criticism of digital assets while simultaneously defending the Federal Reserve's autonomy. Speaking at the 2026 Midwest Economic Outlook Summit in Fargo, North Dakota, Kashkari candidly described crypto as "utterly useless," asserting that despite its decade-long existence, it has yet to demonstrate practical value. He sharply contrasted this with artificial intelligence tools, which he noted have already proven clear, everyday utility for both consumers and businesses.

Kashkari extended his skepticism to stablecoins, dismissing their purported benefits over established payment systems such as Venmo, PayPal, or Zelle. During a Q&A session, he challenged the premise of stablecoins, asking, "So what is it that this magical stablecoin can do?" While acknowledging claims that stablecoins could facilitate faster and cheaper cross-border transfers, Kashkari highlighted a critical flaw: recipients must still convert digital tokens into local fiat currency for daily transactions, introducing additional friction and costs. He argued that advocates have yet to present a compelling use case for U.S. consumers, emphasizing that the technology fails to solve domestic financial problems.

Addressing the 'cross-border illusion,' Kashkari shared a personal anecdote involving sending money to his father-in-law in the Philippines. He pointed out that while crypto might seem instant, the necessity of converting it back to local currency negates much of the supposed benefit. He criticized the argument that widespread adoption by local merchants would eliminate friction, stating, "So what they're really saying is if everybody in the world uses the same currency or the same payment platform, all these frictions go away. But all these other countries are not going to abandon their own monetary policy." Kashkari also expressed concern about the structural impact stablecoins could have on traditional finance, warning that they could "put pressure on the economy because banks will lend less." He urged regulators, policymakers, and the public to demand concrete explanations from crypto advocates, advising them not to "settle for word salad nonsense answers" and to make them "really explain how this thing actually works."

Kashkari's vocal skepticism towards cryptocurrency is consistent and long-standing. In November, he likened the sector to the 1990s Beanie Babies bubble, maintaining that it lacks meaningful economic use. During a CNN appearance, he expressed greater confidence in AI's ability to deliver real economic value, while crypto, he contended, fails to demonstrate a compelling purpose. He noted that the primary application he hears for digital assets in the U.S. is to bypass banking regulations like know-your-customer (KYC) and anti-money-laundering (AML) rules—a use he described as "lousy" for a Federal Reserve policymaker. His criticisms date back to 2018, when he publicly labeled the cryptocurrency market a "farce," and he reiterated similar views just last month, asserting crypto had no use for everyday consumers.

Beyond digital assets, Kashkari also addressed criticism directed at a New York Fed study on tariffs by National Economic Council Director Kevin Hassett. He characterized Hassett's remarks as "another step to try to compromise the Fed's independence." Kashkari highlighted multiple attempts over the past year to undermine the Fed's autonomy, including a December subpoena from the Department of Justice related to building expenses. He underscored the fundamental importance of central bank independence for effective monetary policy, arguing that policy decisions are best made based on data and analysis rather than short-term political considerations, a principle observed by "every advanced economy in the world."

Regarding the broader economy, Kashkari observed that inflation has moderated to between 2.5% and 3%, while unemployment has increased from approximately 3.5% to 4.3%. He indicated that the Federal Reserve is "pretty close to neutral" following multiple interest rate cuts over the preceding two years.