Outgoing Federal Reserve Board Chair Janet Yellen said Wednesday that bitcoin is a "highly speculative asset," and downplayed its supposed role as a currency.
"Bitcoin at this time plays a very small role in the payment system," she said at her final press conference in Washington. "It is not a stable store of value, and it doesn't constitute legal tender."
"It is a highly speculative asset," she added.
Yellen's description of the trendy cryptocurrency came after the value of a single bitcoin has soared in value, and was approaching $20,000 this week. Some have called it a valuation bubble unlike anything seen since the tulip bulb mania in Holland centuries ago.
However, she said the Fed has no policy related to bitcoin and has not offered any specific guidance to banks on the new, rising asset.
"The Fed doesn't really play any ... regulatory role with respect to bitcoin other than assuring that banking organizations that we do supervise are attentive that they are appropriately managing any interactions they have with participants in that market, and appropriately monitoring any anti-money laundering, bank secrecy Act responsibilities that they have," she said.
On the stock market, Yellen noted that the Fed has said in recent months that valuations are "elevated" and "on the high end" of the historical range.
But she also said economists aren't very good at knowing when they are too high and said just because valuations are high doesn't mean stocks are overvalued.
