Carter stated that Kashkari’s statements contradict the facts shown by the data. In a post on the X platform on October 22, he stated that he found Kashkari’s views unfortunate, saying “It should be illegal to be this wrong.” Because Neel Kashkari is considered one of the most important financial regulators worldwide.

In his post, Carter linked to a number of data sources that refute Kashkari’s assumptions. These included a study by blockchain data firm Chainalysis in 2023.

According to this research, only 0.34% of crypto transactions were linked to illegal activities. The report revealed that illegal crypto transactions peaked at 1.29% in 2019 and subsequently decreased.

Speaking at an event hosted by the Chippewa Falls Chamber of Commerce on October 21, Neel Kashkari suggested that cryptocurrencies are used for “very few transactions, really.”

“People aren’t paying for goods and services with crypto. This generally doesn’t happen unless people are purchasing drugs or other illegal activities,” Kashkari said. However, such comments are criticized by many experts and accused of not being based on real data.

Carter stated that it is misleading to associate cryptocurrencies only with high-profile crimes. A study by Crypto ISAC found that cash is still the financial instrument of choice for criminals.

According to the research, the role of cryptocurrencies in criminal activities is limited. While cryptocurrencies have been linked to some high-profile crimes, such as stock market crashes and thefts, such transactions account for a relatively small portion of total transaction volume.

While it is difficult to pinpoint the extent of illicit activity in the traditional financial system, Crypto ISAC states that the estimated amount of money laundering worldwide in a year accounts for 2% to 5% of global GDP.

This corresponds to a value between 800 billion and 2 trillion dollars. However, only 0.34% of this total is carried out with cryptocurrencies.

The US Treasury Department also supported this data, stating that cash is the most preferred method for money laundering due to its anonymity and prevalence. Neel Kashkari’s stance on cryptocurrencies has remained stable over the last few years.

In February 2024, he argued that Bitcoin had no practical use in real economic scenarios and questioned the cryptocurrency’s ability to be an effective hedge against inflation.

Additionally, on October 17, the Minneapolis Fed released a report calling on governments to ban or tax Bitcoin. This report suggested that governments should take these steps for sustainable financing.

Criticisms from Carter and other experts challenge the prejudice that cryptocurrencies are used only for criminal activities and reveal the true state of data in this field.