The former head of the US Federal Reserve shared his views on bitcoin and explained what “features and bugs” can be found in the cryptocurrency in an interview he gave to Quartz.

Bitcoin is interesting technologically, Bernanke said. In a world where different ways of payment are developing quickly, some of the ideas associated with bitcoin might prove useful.

At the same time, according to Bernanke, bitcoin’s anonymity and volatility are both serious shortcomings that can complicate its international official recognition.

Ben Bernanke noted that the price of bitcoin has been very volatile since its creation, and “it hasn’t shown to be a stable source of value.”

The anonymity of bitcoin, being both a feature and a bug, turns it into “a vehicle for illicit transactions, drug selling or terrorist financing.” So governments are likely to seek for surveillance over bitcoin transactions and this will not add popularity to the currency, Bernanke said.

The former head of the Fed shared his position on bitcoin in an interview to Quartz in connection with his recent book The Courage to Act. He also touched upon his management style, bubbles, and the political side of finance.

Ben Bernanke was appointed Chairman of the Federal Reserve in 2006 and stayed in this position until 2014, nominated first by George W. Bush and then – for his second term – by Barack Obama. He led the US financial system through the crisis of 2008.

Since bitcoin was created, its price jumped to $1147 in December, 2013, and back to below $200 earlier this year. The price of bitcoin has recently grown again to nearly $500, only to reach a more stable level later on, somewhere above $320.

G7 and European Union are going to tighten regulations on bitcoin, Spiegel and Reuters say. At the same time, Singapore’s Prime Minister has recently emphasised the advantages of the blockchain technology, which is used in bitcoin transactions.

Andrew Levich