- Jerome Powell admitted that the crypto industry “appears to have some staying power”
- Powell made the comments during a monetary policy hearing yesterday
- The Fed chairman added that stablecoins could be seen “as a form of money” in the future
Federal Reserve Chair Jerome Powell has said that the crypto industry “appears to have some staying power” despite the bursting of the most recent bubble. Powell was speaking at the Federal Reserve’s Semi-Annual Monetary Policy Report where the subject of stablecoins was a major topic, with Powell adding that payment stablecoins could be seen “as a form of money,” that central bank cash remained “the ultimate source of credibility in money”. Powell has been less critical of crypto than some of his peers, and his cautious approach seems to be continuing in the wake of heavy-handed action by regulators.
Crypto Legislation Discussions Underway…at Last
During the hearing, Powell emphasized the importance of robust central-bank supervision in the ongoing development of stablecoin regulations proposed by the members of the House Financial Services Committee. Discussions between the Federal Reserve staff and lawmakers regarding cryptocurrency legislation have been underway, and it is anticipated that the legislation will undergo revisions in July, with Powell stating his belief that “it would be appropriate to have quite a robust federal role” in decision making.
Powell added that while the crypto market may have collapsed since 2021, the industry itself “appears to have some staying power,” hinting that underneath the scams and meme coins there is a core of value in the industry.
Two Bills by July
Committee Chairman Patrick McHenry, who is one of the few pro-crypto members, announced at the start of the hearing that the panel is planning to create two cryptocurrency bills by late July, with markup sessions slated for that period. A markup session is an opportunity for open deliberation and potential modifications to the specifics of a bill before it undergoes a committee vote.
McHenry specified that the stablecoin legislation, which has been subject to extensive debate, as well as a comprehensive bill intended to establish regulatory frameworks and oversight for cryptocurrencies in the United States, would be scheduled. Notably, despite several years of deliberation on such initiatives, significant cryptocurrency legislation has yet to receive approval from a committee in either the House or the Senate, although this finally looks like it is about to change. This will hopefully bring more clarity to the crypto space in the US.
