As a seasoned crypto investor with over a decade of experience navigating the volatile digital asset market, I find myself intrigued by the recent comments from Chairman Powell regarding Bitcoin and the Federal Reserve.
Bitcoin, more recently, gained notoriety as a financial asset often likened to “digital gold,” serving as a means to safeguard the worth of currency; this viewpoint is shared by Powell.
In simpler terms, the head of the U.S. Federal Reserve, often referred to as “The Fed,” which is America’s central bank, has openly stated that Bitcoin (BTC) can be seen as a rival to gold. This is because, unlike traditional currencies, Bitcoin is more valued for maintaining money’s worth over time rather than being used for everyday transactions.
This is similar to gold, but in a digital format. Unlike traditional uses like transactional currency or long-term storage, it’s extremely volatile and unpredictable. It doesn’t challenge the US dollar as a global standard, but rather, it competes with gold as an alternative investment option.
Powell mentioned on The New York Times DealBook Summit 2024 posted video on YouTube.
Additionally, he highlighted the importance of the burgeoning cryptocurrency sector finding an appropriate role within traditional banking structures, as he expresses his worry about this matter. He emphasized that this integration should prioritize safety and regulatory oversight.
Regardless of whether the central bank has direct oversight on cryptocurrencies, Powell aspires to ensure that those engaged with these digital assets receive appropriate consumer protections, irrespective of the specific crypto-product they possess.
On the same note, Powell stated explicitly that he has no involvement with cryptocurrencies when this question was posed by the American journalist and writer, Andrew Ross Sorkin.
Powell on Trump’s administration
In 2016, Donald Trump, who later became the re-elected President of the United States following his victory over Kamala Harris, was well-known for having a contentious relationship with Powell at that time. Trump had gone so far as to express his intention to dismiss Powell once he took office, but Powell declined to comment on the matter.
On the contrary, Trump holds a firm position regarding Bitcoin’s role within the nation. He has actually proposed the establishment of a Bitcoin Strategic Reserve, suggesting that it could potentially alleviate the country’s debt problems.
Senator Cynthia Lummis has put forward a plan, known as the Bitcoin Act, to Congress, which is backed by the Republican party. This idea has garnered substantial approval from numerous financial institutions and investors, totaling in thousands.
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2024-12-05 02:22