Jerome Powell, the Fed Chair, said the Federal Reserve cannot hold Bitcoin because it is against the rules. He said Congress, not the Fed, must decide about a U.S. Bitcoin reserve.
Some lawmakers, like Senator Cynthia Lummis and President-elect Donald Trump, support the idea of the U.S. holding $BTC . Lummis even suggested the U.S. Treasury buy one million Bitcoin over five years. Trump said the U.S. should not fall behind other countries like China in crypto.
After Powell’s comments, $BTC price dropped by 5.7% to $100,300. Other cryptos like Ethereum, Binance Coin, and Solana also fell. The stock market reacted too, with the S&P 500 dropping 1.55% and the Nasdaq 100 falling 2%.
Powell made it clear the Fed is not interested in Bitcoin, and his words caused uncertainty for investors.