US Has No Plans To Ban Bitcoin Or Crypto: Fed Chair Powell

United States Federal Reserve Chairman Jerome Powell said the United States currently has no plans to ban cryptocurrencies or Bitcoin BTC/USD.

Powell's Statements On Crypto: During Thursday's Oversight of the Treasury Department's and Federal Reserve's Pandemic Response hearing, Powell told U.S. Rep. Ted Budd that he will not take an approach similar to the one taken by China. The hearing follows the recent strengthening of China's cryptocurrency ban.

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Budd — who is also a member of the Congressional Blockchain Caucus — asked Powell if it was his “intention to ban or limit the use of cryptocurrencies like we’re seeing in China?” and received a clear "no" as the answer.

The representative followed up by clearly asking if he had “no intention to ban them?” to which the Fed chairman answered that he had "no intention to ban them."

Powell On CBDCs: Powell also said that once central bank digital currencies (CBDC) hit the financial landscape, “you wouldn’t need stablecoins.” He also said that stablecoins need greater regulatory scrutiny and compared them to money market funds and bank deposits.

He has gone as far as to suggest that stablecoins should be regulated like the aforementioned traditional products, saying that they are "to some extent outside the regulatory perimeter, and it’s appropriate that they be regulated. Same activity, same regulation.”

Powell On Inflation: Budd also asked about the state of inflation in the U.S.

Powell said inflation is caused by the repeated supply chain interruptions caused by the government's pandemic response. He said the Federal Reserve can do little when it comes to inflation, and that it should decrease “the first half of next year."

Yellen Says Treasury Working On Crypto Regulations: Ohio Rep. Warren Davidson — also a Congressional Blockchain Caucus member — also highlighted the lack of regulatory clarity in the cryptocurrency industry.

He asked Treasury Secretary Janet Yellen to better clarify how digital assets should be treated for tax accounting purposes. She said the agency is still issuing “detailed regulations that will answer that question.”