Fed Chair Jerome Powell Dismisses Cryptocurrencies as Financial Stability Concern but Warns They’re Risky

Fed Chair Jerome Powell Dismisses Cryptocurrencies as Financial Stability Concern but Warns They"re Risky

Federal Reserve Chairman Jerome Powell says that he does not see cryptocurrencies as a financial stability concern. However, he noted that they are risky and “there’s big consumer issues for consumers who may or may not understand what they’re getting.” Fed Chair Powell Says Cryptos Are Risky but Currently Not a Financial Stability Concern

Fed Chairman Jerome Powell talked about cryptocurrency in a press conference Wednesday. Commenting on whether cryptocurrencies are a threat to the country’s financial stability, he said: I don’t see them as a financial stability concern at the moment. I do think they are risky. They’re not backed by anything.

“I think there’s big consumer issues for consumers who may or may not understand what they’re getting,” Powell continued, adding that “There are certainly developments in the markets that are worth following, which are really not in our jurisdiction.”

Powell also discussed stablecoins. He noted that he supports the view expressed in the President’s Working Group’s report, which recommends stablecoin issuers be regulated like banks.

Noting that “Stablecoins can certainly be a useful, efficient consumer-serving part of the financial system if they’re properly regulated,” the Fed chair stressed that “Right now, they aren’t.” Powell concluded: They have the potential to scale, particularly if they were to be associated with one of the very large tech networks that exist.

This week, the Bank of England issued a financial stability report stating that crypto assets “currently pose limited direct risks to UK financial stability.” However, the report warns that “they will present a number of financial stability risks if they continue to grow at their current rapid pace, and as they become more interconnected with the wider financial system.” Tags in this story Fed Chair, fed chair crypto, fed chair cryptocurrency, fed chair stablecoins, Federal Reserve Chairman, financial stability, jerome powell

What do you think about Fed Chair Powell’s comments? Let us know in the comments section below. Kevin Helms

A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography. Indian Government to Make Additional Changes to Crypto Bill: Report REGULATION | 8 hours ago UK Bans Crypto Ads by Papa John"s Pizza, Coinbase, Etoro, Luno, Kraken REGULATION | 20 hours ago

Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleIndian Government to Make Additional Changes to Crypto Bill: Report Next articleGlobal Markets, Bitcoin Defy Expectations After Fed’s Hawkish Taper Plan Announcement Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItAces, Jokers, and NFTs: Playing Card Manufacturer Bicycle Launches NFT Genesis Collection

The well known playing card manufacturer Bicycle has announced the launch of the company’s first non-fungible token (NFT) collection. The NFT card collectibles called the “Genesis Collection” were designed by the artist Adrian Valenzuela and the first drop of NFTs ... read more.Miami Mayor Francis Suarez Plans to Take a Fraction of His 401k in Bitcoin Bitcoin.com Wallet Adds Support For Multisig (Shared) Wallets Indian Prime Minister Narendra Modi to Take Final Decision on Cryptocurrency Regulation Ethereum Co-Founder Vitalik Buterin Publishes "Plausible Roadmap" Addressing Scalability