Main to remember
- The president of the federal reserve, Jerome Powell, said that cryptographic assets become more common and that the industry matures.
- Powell has expressed support to banks that engage with crypto as long as the regulations guarantee security and solidity.
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The president of the federal reserve, Jerome Powell, said on Wednesday that Bitcoin and other cryptographic assets had matured and became more common, and that the Central Bank re -evaluates the policy declarations made at the time of Biden.
Powell’s comments came in response to a question by senator Cynthia Lummis during her testimony on June 25 before the Senate banking committee.
Lummis questioned what had changed concerning the risks of stablecoin since the Fed 2023 policy under article 9 (13), and pressed Powell to find out if the Fed intends to withdraw the declaration of the policy.
Article 9 (13) gives the Board of Directors of the Federal Reserve the power to regulate the activities of members’ banks to the Cargaison of the State. In January 2023, the Fed published an official policy of policy under this authority, clarifying how it would deal with “new activities”, in particular those involving crypto assets, the technology of the great distributed book (DLT) and the Stablecoins.
“The Council generally considers that the publication of tokens on open, public and / or decentralized networks, or similar systems is very likely to be incompatible with safe and solid banking practices,” according to the policy statement.
“The industry matures, our understanding of this improves,” Powell said in Wednesday’s testimony. “And in a sense, it becomes much more common.”
Powell noted that regulators reassess the previous decisions taken during the precocious development phase of the crypto.
“We revisit all the things that were done at that time,” he said.
The president of the Fed also indicated the support of the banks engaged in the crypto under appropriate conditions.
“It is appropriate, it has always been appropriate for banks to choose their customers and be able to undertake activities as long as they are safe and healthy,” said Powell.
Addressing the policy statement of article 9 (13), Powell said that it was part of a wider regulatory framework which was not only focused on the crypto, although the crypto was a component.
He reiterated that the Fed is currently examining and withdrawn several orientations related to cryptography published during the Biden era.
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