Jerome Powell states that the Federal Reserve cannot hold Bitcoin and "does not intend to change that"

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Federal Reserve Chairman Jerome Powell stated that the central bank has no intention of participating in any government efforts to hoard and create Bitcoin strategic reserves.

Powell stated that the Federal Reserve is not allowed to hold Bitcoin and does not intend to change this situation.

The Federal Reserve cannot own Bitcoin

Powell made comments in response to whether he believes Bitcoin strategic reserves have any value. President Donald Trump promised to establish a Bitcoin strategic reserve to maintain a competitive advantage when other countries adopt cryptocurrency. Powell stated that the Federal Reserve is not allowed to hold Bitcoin and does not wish to change the law.

"We are not allowed to own Bitcoin. The Federal Reserve Act stipulates what we can own, and we do not wish to change the law. This is something for Congress to consider, but we do not wish for the Federal Reserve to change the law."

Powell's remarks had an adverse impact on Bitcoin's price, causing a significant drop. Experts warn that there are risks associated with volatile assets like Bitcoin. Bitcoin's value surged in the prospect of Trump winning the election and the U.S. government taking a friendly stance towards cryptocurrency. Trump has repeatedly stated that he would establish a Bitcoin strategic reserve, but this concept has been rejected by Europe.

However, the incoming president did not disclose the specifics of the reserve, only stating that the initial reserve may include seized Bitcoins, which, at current prices, would amount to 200,000 tokens worth $21 billion. Bitcoin has doubled this year, breaking the $100,000 mark, setting a new record.

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