Powell Sees No ‘Macroeconomic Implications’ of Bitcoin Price Fluctuations, But ‘Better Regulatory Framework’ Still Needed

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The Federal Reserve is watching the crypto world closely, but is not worried, according to the central bank chairman.

Fed Chief Jerome Powell said At a Senate committee meeting today, the bank saw no “macroeconomic implications” of bitcoin and volatile price swings in the broader crypto market, but that better regulation was still needed .

“I think the main implication is really what we’ve been saying, and what others have been saying for some time, that in this [crypto] a very innovative new space, there really is a need for a better regulatory framework,” Powell said, after saying the central bank was watching it closely.

Bitcoin and most other coins and tokens in the ecosystem suffered dramatic price declines last month, with many investors worried about the Fed’s interest rate hike to control inflation sold riskier assets.

Bitcoin is currently trading for $20,162.59, according to CoinMarketCap. Last November, it hit $68,789.63. The Crypto Market Selloff Seems to be Close correlated with stocks, and the US stock market has had a horrible year.

Powell was also asked about stablecoins– digital assets linked to fiat currency like the US dollar which are less volatile than Bitcoin and considered the backbone of the crypto market. He said the world of stablecoins was “new and emerging” and lacked the “fit for purpose” regulation it needed.

US authorities have been monitoring stablecoins for some time now, with the Biden administration look for ways to regulate them.

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