Federal Reserve Chair Jerome Powell reaffirmed the institution’s stance regarding Bitcoin reserves, citing legal limitations.
During a recent conference following a monetary policy announcement, Powell clarified that the U.S. central bank is prohibited from owning Bitcoin (BTC) and cannot establish a reserve of the cryptocurrency.
The Fed chair emphasized that existing regulations do not allow for a Bitcoin reserve by the Federal Reserve. Furthermore, Powell indicated that the central bank has no interest in pursuing legal changes that would authorize a government-managed Bitcoin stockpile.
Powell’s remarks followed the final Federal Open Market Committee meeting of the year, where a 25 basis point interest rate cut was announced. In the wake of this news, Bitcoin experienced a downturn, falling 2.1% within an hour and stabilizing around $101,400.
Reiteration of Stance on Bitcoin Reserves
This is not the first time Powell has addressed this issue. He has consistently reiterated the same points at various post-FOMC meetings.
However, his latest comments are particularly relevant given the current political climate, especially with discussions around a national strategic Bitcoin reserve linked to the new administration. While some lawmakers and industry figures have shown support for this initiative, concerns have been raised by crypto experts regarding its potential implications for the strength of the U.S. dollar as a global reserve currency.
