The Federal Reserve Bank of St. Louis has provided some high-profile validation for a core premise of Bitcoin and other cryptocurrencies. A blog post this week based on an earlier Fed research paper said that “Bitcoin units have no intrinsic value” – but added that currencies “such as the U.S. Dollar, the Euro, and the Swiss Frank . . . have no intrinsic value either.”
Fed researchers point out, since decoupling from the gold standard in the early 1970s, almost all global reserve currencies rely on nothing but trust to function as a medium of value exchange.
The post goes on to argue that “there’s a limited supply” of both cash and Bitcoin. Though the Fed’s post acknowledges its ability to expand the money supply.