Monday, September 25, 2023
HomeImmutableXFed Chair says crypto is not a risk to financial stability

Fed Chair says crypto is not a risk to financial stability

  • However, Jerome Powell states that cryptocurrencies are speculative and “not backed by anything”, which can be a problem for consumers.

  • He states that with proper regulation, Stablecoin can be a useful part of the financial system.

Federal Reserve Chair Jerome Powell said Wednesday that cryptocurrencies could pose a risk to investors, but they do not consider them a concern for the financial stability of the US economy.

He did this Press conference After the Fed’s two-day meeting, where the FOMC announced three potential rate hikes in 2022 with faster tapering, Cryptocurrency is a risk that could disrupt the financial system. He said he didn’t think, and the assets were really speculative and “not backed by anything.”

“”can not see [crypto] As a concern about financial stability at this time“.

But he pointed out that cryptography can be a problem for consumers. Consumers may or may not be aware of what the potential risks are.

How about stablecoin?

Powell’s comments come out when many in the crypto industry are asking for proper regulation. Authorities have pointed out that innovation needs to be embraced and not killed.

One such innovation is stablecoin, a type of crypto asset whose value is fixed to another asset, such as the US dollar.

Last month, the US President’s Working Group on Cryptographic Regulation released a report calling on US legislators to pass a new law intended to insure banks for Stablecoin.Last week I saw several cryptocurrency chiefs heading to Capitol Hill to meet lawmakers problem Cryptographic

In his comment on Wednesday, the Fed chair said stablecoin could serve consumers as a useful aspect of the monetary system. However, you need to make sure that they (stablecoins) are properly regulated. Unfortunately, that wasn’t the case at this time.

But just because there is no proper regulation does not mean that Stablecoin cannot play an integral role in the economy, he explained. According to Powell, this sector could be important if its development is linked to one of today’s big tech companies.

In this case, he said that the stablecoin in question was “Efficient consumer service [and systemically important] Part of the financial system.. “

Powell further stated that it is important to comply with all appropriate regulations and have a payment network that provides consumers with the protection they need. He added that these aspects are important because the public depends on the authorities when it comes to ensuring consumer safety.

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