During the New York Times DealBook Summit on December 4, 2024, Federal Reserve Chair Jerome Powell clarified the Fed’s position on Bitcoin and other cryptocurrencies. He stated that the Federal Reserve is prohibited from owning Bitcoin or any digital assets, and this restriction extends to him personally due to his role.
Powell described Bitcoin as a speculative asset, likening it to gold but in a digital form. He explained, "People use Bitcoin as a speculative asset — it’s like gold, only it’s virtual, it’s digital." However, he noted that Bitcoin lacks the qualities needed to function as a medium of exchange or a stable store of value, further emphasizing its volatility.
While Bitcoin is not viewed as a competitor to the U.S. dollar, the Federal Reserve closely monitors the relationship between cryptocurrencies and the traditional banking system to ensure financial stability. Powell clarified that although the Fed observes the crypto sector, it does not directly regulate these assets.
This statement comes at a time when Bitcoin has seen dramatic price surges, recently crossing the $100,000 mark, driven by heightened market interest and significant commentary from financial leaders. Powell’s remarks have added to the ongoing discourse about Bitcoin's role in the global financial landscape.
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