Federal Reserve Chair Jerome Powell says that “banks are perfectly able to serve crypto customers.” While speaking at the latest FOMC meeting, Powell addressed the Fed’s stance and role in Bitcoin as part of the United States Economy, and how it plans to get US banks involved.
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“Banks are perfectly able to serve crypto customers, as long as they understand and can manage the risks,” Powell said. “If you’re making a choice to conduct that activity inside a bank, which is inside the federal safety net with deposit insurance, then you want to be pretty sure that that is a safe and sound activity.”
Jerome Powell Changes Tone on Crypto Industry
Just last month, Jerome Powell said the U.S. central bank has no desire to be involved in any government effort to stockpile large amounts of crypto. “We’re not allowed to own Bitcoin,” he said. However, one of Donald Trump’s first executive orders involved founding a digital asset stockpile for the US government, one that will likely hold BTC.
Cryptocurrencies are on the rise as President Trump has embraced digital asset innovation. However, Fed Chair Powell’s opinion as to whether or not crypto should be viewed as having a place in a household’s portfolio is much more vague. Powell said that deciding this was not really their place but indicated he thought Congressional action to create a bespoke framework for crypto made a lot of sense.
Also Read: Texas Lieutenant Governor Unveils Plan for Bitcoin Reserve in 2025
The crypto industry is also waiting on a final decision by the Fed to execute or deny another interest rate cut to start 2025. The Fed decided for the first time in years to cut interest rates on multiple occasions in 2024. As the US continues to battle inflation, rate cuts are seen as signs of the US winning that battle. Just two weeks ago, top Federal Reserve official Christopher Waller told CNBC that three to four cuts are still possible this year, “if the data cooperates.”