Chairman of the Federal Reserve Jerome Powell has come out to say that the United States government has no intention of mimicking China’s crackdown on crypto.
Jerome Powell made the comments in a two-hour long House Financial Services Committee meeting on Thursday. The meeting, meant to serve as a forum for representatives to ask Treasury Secretary Janet Yellen and Powell about the Treasury Department’s and Federal Reserve’s pandemic response, featured several questions about cryptocurrencies.
The central banker, however, indicated that cryptocurrencies (especially stablecoins) need to be regulated.
“They’re to some extent outside the regulatory perimeter, and it’s appropriate that they be regulated. Same activity, same regulation,” Powell replied.
Bitcoin rose 10.8% from its 5 p.m. ET value on Thursday to $48,495.00, its highest level in almost a month. Ether, the second-largest crypto by market value, also gained 10.8% to $3,293.01 over the same period.
There was no obvious catalyst for the move upward in the notoriously volatile digital currencies, which happened early Friday morning. Some traders pointed to Mr. Powell’s comments to the House Financial Services Committee on Thursday and to the start of the fourth quarter on Friday, when investors sometimes reset their portfolios.
The Federal Reserve is currently evaluating the benefits and costs of creating a central bank digital currency, and a report about the “digital dollar” is expected to be published in the nearest future.
Amid the growing popularity of digital assets in the US, many are keen to see how to government reacts. Tech entrepreneur Elon Musk recently advised the government to give the new asset class some breathing space – “I would say, do nothing. Just let it fly.”
