FED Chairman Speaks Bitcoin Movement: What Did He Say? - Coin Newsletter

U.S. Federal Reserve Chairman Jerome Powell has indicated that regulations on banks' crypto-related activities may be loosened. Powell also stressed that it makes sense to establish a legal framework for stablecoins.

U.S. Federal Reserve (Fed) Chairman Jerome Powell**, in his statements on Wednesday, gave important messages about both cryptocurrencies and economic risks. Powell stated that digital assets are now becoming more mainstream and said that crypto restrictions on banks may be partially relaxed. At the same time, he emphasized that the legal framework for the regulation of stablecoin is progressing rapidly.

Speaking at The Economic Club of Chicago, Powell said that despite the wave of fraud and bankruptcies in the industry in recent years, crypto assets are gaining general acceptance. Noting that previous restrictions on banks were quite cautious, Powell said, "I think some of these rules will be relaxed." However, he added that this process will take place in a way that protects consumers and does not jeopardize the financial system.

With the Trump administration taking office, U.S. financial regulators have begun to take a softer stance towards cryptocurrencies. The FDIC (Federal Deposit Insurance Kurumu) has announced plans to remove the requirement to obtain prior authorization for crypto-related activities. In addition, the OCC (Para Unit Supervisory Ofisi) has clarified that federal banks can conduct crypto-related transactions within the legal framework.

Crypto gets a legal footing

The U.S. Congress is moving rapidly to create legislation that will regulate stablecoins. Both the House of Representatives and the Senate passed their respective bills through their committees. President Trump, on the other hand, wants the bill to be submitted for signature as soon as possible.

Expressing that he finds these developments positive, Powell said, "Stablecoins are digital products that can be widely adopted. Therefore, it makes sense that they should be supported by regulations that include transparency and consumer protection," he said.

Impact on the economy and crypto: Stagflation concerns

Powell's remarks were not limited to crypto. Speaking about the Trump administration's new tariffs, Powell said they could increase inflation and limit growth. This may make it difficult for the Fed to achieve both its price stability and employment goals at the same time.

Following these statements, the price of Bitcoin reversed its short-term rise and fell 2.5% to $83,700. Powell's hawkish (hawkish) stance has eliminated the possibility of a rate cut in May. Analysts note that the Fed has little intention of providing liquidity to the market, which could put pressure on crypto markets.