Federal Reserve chair Jerome Powell spoke on March 7 in entrance of a Senate Banking, Housing and City Affairs Committee.
Through the listening to, he was questioned by Senator Cynthia Lummis (R-Wyoming) about permissionless distributed ledgers and whether or not they had anyplace throughout the monetary system.
Powell stated:
“There are actual considerations about permissionless public blockchains, and the reason being that they’ve been so inclined to fraud, to cash laundering and all of these issues. I believe what you heard from the federal banking companies in one in every of their experiences was that they’d have a tendency to have a look at these as inconsistent with security and soundness.”
On stablecoins, Powell stated that with “acceptable regulation,” they may merge with conventional banks.
“The place stablecoin exercise will get the identical regulation as comparable merchandise elsewhere, then there definitely could possibly be a spot for stablecoins in our monetary companies sector,” the Fed chair stated.
Lummis additionally pressed Powell on the necessity for digital asset regulation. She in contrast the US to different jurisdictions just like the UK, the EU, Switzerland and Singapore, all of which have moved within the final a number of years to create legislative frameworks for digital property, whereas the US has lagged.
“I do suppose it will be essential for us to have a workable authorized framework round digital actions,” Powell added. “I believe that’s essential and one thing Congress in precept, must do, as a result of we will’t actually do this.”
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