tl;dr
The US central bank chair emphasized the need for greater regulatory oversight of cryptocurrencies and expressed support for banks serving crypto customers. He also stated that the central bank was not against innovation in cryptocurrencies but highlighted the importance of managing risks. Additiona...
Federal Reserve Chair Powell addressed the need for greater regulatory oversight of cryptocurrencies and expressed concerns about "debanking" efforts. He emphasized that the central bank is not against innovation in cryptocurrencies and advocates for banks to serve crypto customers responsibly. Additionally, he avoided a direct response to President Trump's comments and actions, underlining the Fed's readiness to support monetary policy.
Martin J. Young, an experienced cybersecurity and cryptocurrency writer, covered developments in the blockchain and cryptocurrency industry. Editorial pieces covered topics such as Virtuals, Hyperliquid, Truth Terminal, real-world assets, the future of NFTs, and the impact of Trump's presidency on crypto.
The US central bank chair emphasized the need for greater regulatory oversight of cryptocurrencies and expressed support for banks serving crypto customers. He also stated that the central bank was not against innovation in cryptocurrencies but highlighted the importance of managing risks. Additionally, he mentioned that there had been no contact with the new president and emphasized the Fed's readiness to support monetary policy. Economic data is expected later in the week, and crypto markets were marginally up, with Bitcoin leading.
"I do think it would be helpful if there were a greater regulatory apparatus around crypto," the US central bank chair said at the Federal Open Market Committee press conference on Jan. 29. He added that it is something Congress and the Fed have been “working on quite a lot.”
Powell also mentioned that the central bank was “not against innovation” with regard to cryptocurrencies. Speaking about banking restrictions, he added, “We certainly don’t want to take actions that would cause banks to, you know, terminate customers who are perfectly legal just because of excess risk aversion, maybe related to regulation and supervision.”
Powell’s remarks at the first FOMC meeting under the Trump administration came as concerns about so-called “debanking” efforts have risen to the highest ranks of government.
“Banks are perfectly able to serve crypto customers, as long as they understand and can manage the risks, and it’s safe and sound,” Powell said before adding, “The threshold has been a little higher for banks engaging in crypto activities, and that’s because they’re so new.” He noted that individual investors needed better protection as the risks may not be fully understood. He also compared crypto to stocks and mutual funds, saying that similar consumer safeguards should apply.
The central bank chair has avoided responding directly to comments made or actions taken by Donald Trump in recent weeks. He said there has been “no contact” with the new president, noting that disagreements would undermine the Fed’s credibility.
More economic data is expected this week, with fourth-quarter GDP Growth Annualized advance estimates due on Thursday and December’s Core Personal Consumption Expenditures (PCE) report due on Friday. Crypto markets were up marginally during the Thursday morning Asian trading session, with Bitcoin leading the pack and reclaiming $105,000.