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 cryptocurrencies.
Powell confirmed the stance of the government during a Thursday hearing held by the House Committee on Financial Services. He responded to a question from the conservative Rep. of North Carolina Ted Budd question on whether the Fed was looking to ban or restrict the use of digital currencies.
The central banker, however, indicated that cryptocurrencies (especially stablecoins) need to be regulated.
There is no intention to ban them, but, you know, stablecoins are like money-market funds, they are like bank deposits, but they are, to some extent, outside of the regulatory perimeter. It’s appropriate that they be regulated.
Recall that the People’s Bank of China classified all crypto-related activities as illegal just last week.
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.”
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.