Jerome Powell, the chairman of the Federal Reserve, believes the federal government should regulate the cryptocurrency market, but that there is no general ban on Bitcoin (BTC) and other digital assets.
In response to Ted Budd, the Republican representative of North Carolina, Powell made it clear that a ban on digital assets similar to that undertaken by China was not something he was considering. Rep Budd’s question came in response to Powell, who raised doubts about the regulatory status of stablecoins and the central bank’s deliberations on the so-called “digital dollar”. According to Powell, a CBDC could perform many of the functions of a stablecoin and cryptocurrency, but without incurring regulatory risk.
“Stablecoins are like money market funds [e] bank deposits, but they are, to some extent, outside the regulatory scope and it is appropriate that they be regulated“, has affirmed. “Same business, same regulation.“
“Fed Chairman Powell says he has no plans to ban #Bitcoin and cryptocurrencies.”
– LilMoonLambo (@LilMoonLambo) September 30, 2021
Related: Countries accounting for over 90% of global GDP are considering CBDCs
A Central Bank Digital Currency has long been on the Fed’s radar, but politicians remain undecided about whether to pursue the project. Meanwhile, the central bank has commissioned several research reports on the benefits and potential barriers to issuing a CBDC.
Powell oversees the central bank’s Federal Open Market Committee, which is responsible for shaping US monetary policy. Earlier this month, the Committee decided to leave its existing stimulus programs intact, but said the pandemic-induced bond-buying program could soon run out. The warning appears to have put some downward pressure on risk assets, which include stocks and cryptocurrencies.