Powell’s remarks came in response to Senator Kyrsten Sinema’s (D-AZ) question about the impact of recent crypto market volatility on the Fed’s operations, including any macroeconomic implications.
Powell stated that the Fed is monitoring the situation “very carefully,” but the US central bank is “not seeing significant macroeconomic implications, so far.”
“But I think the principle implication is really what we’ve been saying and what others have been saying for some time, which is that in this very innovative, new space, really there is a need for a better regulatory framework,” Powell continued, adding:
“The same activity should have the same regulation no matter where it appears, and that isn’t the case right now because a lot of the digital finance products, in some ways, are quite similar to products that have existed in the banking system or the capital markets but they’re just not regulated the same way. So we need to do that.”
Bitcoin’s and other digital asset prices have risen and fallen in recent days, with Bitcoin falling below $18,000 during weekend trading. According to Coinbase data, the price of bitcoin is currently around $20,800.
