Fed Chairman Not Concerned Cryptocurrency Disrupts US Financial System

Federal Reserve (Fed) chairman Jerome Powell suggested that while the government agency should consider monitoring developments in the crypto space, it does not see cryptocurrencies as a threat to the financial stability of the United States.

In response to a crypto question from Michael Derby of the Wall Street Journal on Tuesday, Powell said: donate Completed a report by the President’s Financial Markets Working Group dated Nov. 11. The report suggests that stablecoin issuers be subject to the same “reasonable federal control” as banks.

“Stablecoins can certainly be a useful ingredient and serve consumers efficiently if properly regulated. But at the moment they are not managed. They have the potential to scale, especially when connected to one of the very large existing technology networks. ”

“You can have a systemically important instant payment network, but without proper regulation and security. The public relies on the government, and especially the Fed, to make sure the payment system is safe and reliable. ”

Powell appears to support the Biden administration’s recent stance on digital assets ahead of his hearing as Fed second chairman. Powell has served on the Fed’s Board of Governors since 2012 and Chairman since 2018, and was chosen by Biden to lead the Fed through 2026.

Although the Fed president said that cryptocurrencies may not pose a threat to US financial stability right now, he still describes digital currencies as speculative assets that are “at risk” and “unbacked”. Powell previously raised his concerns about cryptocurrencies – adding that he would not support the ban on assets in the Chinese way – while also expressing the need for regulations on stablecoins. The chairman said in September:

“Stablecoins are like money market funds, like bank deposits, but to some extent they are unregulated and should be regulated. Same operation, same regulation. ”

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