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Cryptocurrency News Articles
Jerome Powell Compares Bitcoin to Gold, Downplays Its Threat to the Dollar
Dec 05, 2024 at 04:56 am
Federal Reserve Chair Jerome Powell addressed the perception of Bitcoin (BTC) at the DealBook Summit on Wednesday, asserting that the cryptocurrency is more akin to gold than the U.S. dollar.
Federal Reserve Chair Jerome Powell compared Bitcoin (CRYPTO: BTC) to gold during an appearance at The New York Times DealBook Summit on Wednesday.
Powell stated that people use Bitcoin as a speculative asset, likening it to gold but in a virtual and digital form.
He noted that the cryptocurrency is not being used as a primary form of payment or as a reliable store of value due to its high volatility.
Powell also said that Bitcoin does not pose a threat to the Federal Reserve or the strength of the U.S. dollar, adding that it is more of a competitor for gold.
When asked about a potential national Bitcoin reserve, Powell highlighted the Federal Reserve's goal of maintaining a "safe and sound" banking system.
He emphasized that any interaction between the cryptocurrency ecosystem and the traditional financial banking system should not put the health of the banking system at risk.
Powell also mentioned that it is not the Federal Reserve's responsibility to regulate the cryptocurrency industry.
Regarding his personal cryptocurrency holdings, Powell stated that he is not permitted to own Bitcoin.
In other news, Powell also discussed the state of the U.S. economy during the event.
He described the economy as being "in remarkably good shape," attributing this strength to stable growth and decreasing inflation.
Powell highlighted that the economy is growing at about 2.5% annually, with inflation decreasing from over 7% to around 2.3%, all while maintaining steady unemployment rates.
This economic stability, according to Powell, allows the Federal Reserve to adopt a cautious approach towards reaching a "neutral" interest rate level.
He explained that moving too quickly might reverse the progress made on inflation, while a slow approach could potentially hurt the labor market.
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