Federal Reserve Chair Jerome Powell recently made several noteworthy remarks to Congress regarding crypto and monetary policy. He confirmed that U.S. banks are free to provide services to crypto companies and engage in crypto-related activities, provided they do so responsibly and with proper safeguards to protect customers and the financial system. This development is seen as a significant step toward bridging the gap between the banking sector and the crypto industry, potentially making digital assets more accessible through traditional financial channels.
Powell also clarified the Fed’s legal position on Bitcoin, stating that the central bank is not allowed to purchase Bitcoin and has no intention of seeking such authority.
On interest rates, Powell offered a message that many analysts see as contradictory. He suggested that the Fed may only cut rates later this year, despite the central bank's own projections pointing to rising inflation. Critics argue that pursuing rate cuts in the face of persistent inflation risks destabilizing the economy and reflects an inconsistent policy stance.
