Federal Reserve Chairman Jerome Powell and Congressional Leaders Discuss Cryptocurrency’s Future, Stablecoins, and Regulatory Clarity

Federal Reserve Chairman Jerome Powell believes that cryptocurrency is here to stay and will play a significant role in the US economy. He thinks that stablecoins, which are a type of cryptocurrency used for payments, should be considered as a form of money. Powell also underlined that the government should have a strong involvement in creating rules and regulations for stablecoins.

In simpler terms, Powell believes cryptocurrency is becoming a popular and valuable asset, especially stablecoins used for payments, and wants the government to make sure they are properly regulated and controlled.

Congressman Davidson and Chairman Powell Discuss Cryptocurrency’s Future and Regulatory Clarity

During a congressional hearing, Congressman Warren Davidson expressed that cryptocurrency currently has a market value of around $1.1 trillion. He asked Federal Reserve Chairman Jerome Powell if he believes it will continue to be relevant in the US economy.

Powell responded by acknowledging that cryptocurrency seems to have some staying power. He also mentioned that the market value of cryptocurrency was higher a year ago, indicating its volatility.

Congressman Davidson then explained that the crypto market’s instability is partly due to the lack of legal clarity surrounding it. He expressed the committee’s intention to address this issue by introducing new bills, including one specifically focusing on stablecoins.

He further highlighted the involvement of the US Securities and Exchange Commission (SEC) in the crypto space and emphasized the importance of providing clear guidelines for SEC Chair Gary Gensler, Congress, and industry participants.

Thereby, Congressman Davidson believes that cryptocurrency is here to stay but recognizes the need for regulatory clarity. He aims to introduce new bills to address this issue and ensure that the SEC and other stakeholders have a clear framework.

Chairman Powell and Rep. Waters Discuss Stablecoins and Federal Oversight

During the congressional hearing, Rep. Maxine Waters discussed stablecoins with Chairman Powell. She mentioned a proposed bill that would create 58 different licenses, where only two licenses would require federal regulatory approval. The remaining 56 licenses could be issued by individual states, territories, and Washington D.C. with minimal federal oversight.

In response, Powell expressed that payment stablecoins should be considered as a type of money. He emphasized the importance of a strong federal role in regulating stablecoins in order to prevent excessive private money creation at the state level. Powell also highlighted that central banks are the ultimate source of credibility for money in advanced economies.

In simpler terms, Rep. Waters explained a bill that would allow many different licenses for stablecoins, with only a few requiring federal approval. Chairman Powell agreed that stablecoins used for payments should be seen as a form of money. He emphasized the need for robust federal regulations to avoid excessive private money creation by states. Powell further stated that central banks play a crucial role in maintaining the credibility of money in advanced economies.