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US Fed Chair Jerome Powell Breaks Silence on Bitcoin Strategic Reserve
Federal Reserve Chair Jerome Powell has finally broken his silence regarding the possibility of adding Bitcoin to the central bank’s balance sheet. Speaking at a press conference yesterday, Powell dismissed any prospects of such an action, citing legal constraints under the Federal Reserve Act.
Powell emphasized that the institution is not pursuing legislative changes to enable the ownership of Bitcoin. He stressed that changing the law is something for Congress to consider, but it’s not something the Fed is looking into.
“We’re not allowed to own Bitcoin,” Powell explained. “The Federal Reserve Act outlines what we can hold, and we’re not pursuing any amendments to that law.”
Following Powell’s remarks, the price of Bitcoin experienced its first decline in four days, dropping 5.9% to $100,605 after reaching an all-time high of $108,000 earlier this week.
Market reactions were further dampened by the Federal Reserve’s cautious stance, as Powell indicated that monetary policy has become “significantly less restrictive” following a full percentage point reduction in interest rates this year.
Powell also noted that future rate cuts would be guided by economic data, particularly inflation trends and labor market performance. “Our decisions moving into 2025 will depend heavily on progress in these areas,” he stated.
Despite the price dip, blockchain analytics firm Santiment highlighted Bitcoin’s resilience, stating that its ability to remain above $100K despite Powell’s comments and market volatility demonstrates underlying strength. The firm predicts that this may play out positively over the next 24-48 hours.
Meanwhile, President-elect Donald Trump has reiterated his ambition to establish a Bitcoin reserve for the United States, a proposal he first introduced during his presidential campaign. Speaking on December 12, Trump emphasized the importance of staying competitive in the global crypto space.
“We’re going to do something great with crypto,” Trump declared. “We don’t want other nations, like China, taking the lead while we stand by. We need to be ahead.”
It remains unclear whether Trump’s proposed reserve would include existing holdings or require new acquisitions from the market.
Source: www.cryptonewsz.com
