Federal Reserve Chair Jerome Powell advocates for greater regulatory oversight of the cryptocurrency market during a press conference. He stresses the importance of risk management for banks engaging with crypto customers and highlights the need for consumer protection similar to that provided for stocks and mutual funds.
Jerome Powell , chair of the US central bank, indicated a need for more comprehensive cryptocurrency regulation during the Federal Open Market Committee press conference on January 29. He emphasized that Congress and the Federal Reserve have been actively working on this issue. Powell expressed his belief that increased regulatory oversight would be beneficial for the cryptocurrency market, suggesting that collaboration with the House Financial Services Committee has been productive.
He stated that the central bank is not opposed to innovation in the cryptocurrency space but stressed the importance of risk management for banks engaging with crypto customers. Powell acknowledged the need for improved consumer protection in the crypto sector, arguing that similar safeguards should apply as those for stocks and mutual funds, given the potential risks associated with cryptocurrencies. Powell also addressed the issue of banking restrictions related to cryptocurrency, stating that the aim is not to force banks to terminate legitimate customers due to excessive risk aversion stemming from regulations. He clarified that banks are capable of serving crypto customers as long as they understand and effectively manage the associated risks. Powell highlighted that the entry threshold for banks participating in crypto activities has been higher due to the nascent nature of the industry. He noted that individual investors require enhanced protection as they may not fully comprehend the risks involved. Powell's comments came amidst a period of anticipated economic data releases, including fourth-quarter GDP growth estimates and December's Core Personal Consumption Expenditures (PCE) report. Meanwhile, crypto markets experienced a slight upward trend during the Thursday morning Asian trading session, with Bitcoin leading the gains and surpassing $105,000.
CRYPTOCURRENCY REGULATION JEROME POWELL FEDERAL RESERVE RISK MANAGEMENT CONSUMER PROTECTION
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