Xinhua News Agency, Beijing, December 19 - Jerome Powell, Chairman of the U.S. Federal Reserve, said on the 18th that the Federal Reserve has no intention of participating in any government-led "hoarding Bitcoin" program, because as the central bank of the United States, the Federal Reserve "has no authority to hold Bitcoin."
On November 7, Jerome Powell, Chairman of the U.S. Federal Reserve, attended a press conference in Washington. Xinhua News Agency reporter Hu Yousong photographed. Powell's remarks were in response to President-elect Donald Trump's idea of promoting the establishment of a "strategic reserve for Bitcoin" by the federal government after taking office. Trump did not provide detailed information, only stating that the initial reserves could include Bitcoin confiscated from criminals, reportedly around 200,000 coins, which have a total value of about $21 billion at current market prices.
According to Reuters, Trump's public support for the development of the cryptocurrency industry has invigorated the "crypto community" regarding his prospects for a second term. In the U.S. market, the prices of cryptocurrencies like Bitcoin have surged. The trading price of Bitcoin has more than doubled this year, having soared to around $100,000 each.
Trump plans to create a new position of White House Director of Artificial Intelligence and Cryptocurrency Affairs after taking office, nominating former PayPal executive David Sacks for the role. He also nominated Paul Atkins to chair the Securities and Exchange Commission. Both individuals are staunch supporters of developing cryptocurrencies.
However, some analysts have pointed out that due to the frequent and severe fluctuations in the value of Bitcoin over its 15-year development history, it is not very reliable as a means of storing value or as a medium of exchange, which are key functions of a national reserve currency.
Some within the Republican Party have responded to Trump's proposal. Federal Senator Cynthia Lummis has drafted a proposal to establish a Bitcoin reserve, intending for the U.S. Treasury to purchase 200,000 Bitcoins annually, with a goal of accumulating 1 million coins, funded by deposits from various Federal Reserve banks and gold reserves.
According to a report released by Barclays this week, in order to establish such a Bitcoin reserve, congressional approval is needed, as well as the Treasury issuing new bonds. Some analysts estimate that the relevant plan "will face strong resistance from the Federal Reserve."
Powell said that the legal issues concerning the establishment of a strategic reserve for Bitcoin are "something Congress should consider, but the Federal Reserve does not intend to seek a revision of the law."
Federal Reserve officials generally maintain a skeptical attitude toward cryptocurrencies as digital assets, and the previously developed plan for a "digital dollar" has already been shelved. Powell stated on the 4th of this month: "The Federal Reserve is responsible for regulating and supervising banks, and we hope that the interaction between the cryptocurrency industry and banks... will not threaten the health of the banking system." (Shen Min)