Značka: jerome powell

US lawmaker hints at upcoming crypto legislation as Jerome Powell says Fed will release report on digital currency soon

At his confirmation hearing in front of members of the Senate Banking Committee, Federal Reserve chair Jerome Powell said the agency would be releasing its report on cryptocurrencies “within weeks.”Addressing Idaho Senator Mike Crapo remotely from the Dirksen Senate Office Building on Tuesday, Powell said the Fed’s report on digital currencies wasn’t “quite where we needed to get it” but would be released soon regardless. The Fed chair cited “changes in monetary policy” as part of the reason for the delayed report, which is expected to address policy surrounding the possible rollout of a central bank digital currency in the United States.“It’s more going to be an exercise in asking questions and seeking input from the public rather than taking a lot of positions on various issues, although we do take some positions,” said Powell. “The report really is ready to go and I would expect we will drop it — I hate to say it again — in coming weeks.”Powell’s testimony comes the same day Minnesota Representative Tom Emmer hinted on Twitter that he would be unveiling new legislation related to digital currency, without providing specifics. It’s unclear if the upcoming bill would be aimed at “fixing” the definition of a broker in the infrastructure law, which took effect November 2021, or another regulatory path to encourage innovation in the crypto industry. New digital currency legislation coming soon— Tom Emmer (@RepTomEmmer) January 11, 2022During his time as Fed chair, Powell has suggested there was no rush in the U.S. releasing a digital dollar despite other countries, including China, moving ahead with CBDCs. In December, he spoke in favor of stablecoins, saying they could be a “useful, efficient consumer-serving part of the financial system if they’re properly regulated.”Should he receive more than 50 votes once his nomination goes to the full Senate, Powell would be re-confirmed as the Fed chair for another four years. Lael Brainard will also be addressing U.S. lawmakers in a Thursday hearing regarding her confirmation as the Fed vice chair, replacing Richard Clarida.Related: US is not moving fast enough to develop a CBDC, says former CFTC chairAt least three seats at the Federal Reserve’s board of governors will be open to nominations from U.S. President Joe Biden in 2022 following the departure of Clarida, who yesterday announced he intended to resign on Jan. 14 ahead of his term expiring. Biden is reportedly considering Duke University law professor Sarah Bloom Raskin to join the group of seven governors, in addition to economists Lisa Cook and Philip Jefferson.Cointelegraph reached out to Tom Emmer’s office, but did not receive a response at the time of publication.

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Ethereum plunges 13%, down more than Bitcoin after Fed spooks crypto market

Ethereum’s native token Ether (ETH) plunged sharply hours after the U.S. Federal Reserve released the minutes of their December meeting, showing that they eye a faster timetable for hiking interest rates in 2022.The minutes showed that the Federal Open Market Committee (FOMC) is in favor of raising short-term rates “sooner or at a faster pace than participants had earlier anticipated.” According to the CME Group, trading in the interest-rate futures market showed a two-thirds possibility of the first increase in March.Ether turned lower after the minutes were released, dropping by over 13.50% to as low as $3,300. Its plunge mirrored similar downside moves across the crypto market, with Bitcoin (BTC) shedding a little over 9% to nearly $42,100.ETH/USD four-hour price chart. Source: TradingViewIncontestably, ETH/USD returned more losses to its investors than BTC/USD after the Fed’s spook. It appears traders decided to unwind tokens sitting atop better long-term profits than Bitcoin. For instance, Ether’s returns in the last 12 months — even after the Fed-led drop — came out to be around 175%. On the other hand, Bitcoin’s profits were nearly 15.75% in the same period.Performance of top fifteen cryptocurrencies. Source: MessariSimilarly, Ethereum’s top rival Solana (SOL) also logged more losses than Bitcoin, dipping by more than 13.75% after the Fed news. Nonetheless, its 12-month profits came out to be more than 7,500%, signaling further extreme corrections if the crypto market’s bias remains skewed toward the bears.ETH/BTC reaches key rebound levelEther also plunged against Bitcoin, according to the performance of a widely-traded instrument, ETH/BTC, in the past 24 hours.The pair dropped by a little over 5% to hit 0.077 BTC. In doing so, it also reached a critical support level near 0.078 BTC that has recently been instrumental in keeping Ether bullish against Bitcoin by limiting the former’s downside bias.ETH/BTC daily price chart showing its key support level. Source: TradingViewMeanwhile, the 0.078 BTC-support also appeared to be the lower trendline of Ether’s descending triangle. Descending triangles are continuation patterns that typically send the price in the direction of its previous trend after a consolidation period.That increases Ether’s potential to remain stronger than Bitcoin in the long run, as long as it breaks above the triangle’s upper trendline with convincingly higher volumes.Too soon to fear the FedFor months, Fed officials were stuck to the opinion that higher inflation in the U.S. drew its inspiration from supply-chain bottlenecks, with chairman Jerome Powell asserting that it would resolve by itself. But in the latest meeting, he showed less conviction toward the so-called “inflation-is-transitory” narrative.That is primarily because the U.S. consumer price index (CPI) reached a nearly 40-year high in November 2021, hitting 6.8% year-over-year. Meanwhile, core consumer prices, which exclude energy and food categories, rose to 4.7% from a year earlier; it came to be above the Fed’s preferred inflation target of 2%.”There’s a real risk now, I believe, that inflation may be more persistent and…the risk of higher inflation becoming entrenched has increased,” said Powell on Dec. 15 last year after concluding the FOMC meeting.U.S headline inflation over the years. Source: Bloomberg, Bureau of Labor StatisticsMadison Faller, a global strategist at JPMorgan Private Bank, told Bloomberg that investors should not fear the Fed, noting that their three planned rate cuts in 2022 would do little in curbing down consumer prices. Excerpts from her statement:“Growth and inflation will be decelerating throughout 2022, but nonetheless remain above historic trend levels. We think this will call for a much lower risk of a Fed-induced material market correction.”As Cointelegraph also covered, fears of persistently higher inflation, which, in turn, tends to devalue cash, have prompted mainstream investors to park their money in the crypto sector. For instance, Thomas Peterffy, the billionaire founder of brokerage firm Interactive Brokers Group Inc., admitted that he holds 2-3% of his net assets in crypto just in case the fiat money “goes to hell.” Likewise, Bridgewater Associates founder Ray Dalio revealed last year that his investment portfolio contains Bitcoin.The outlook against inflation promised to offer some respite to Ether, which tends to tail the Bitcoin price movements. Meanwhile, Sean Farrell and Will McEvoy, strategists at Fundstrat Global, noted that investors should increase their investments across the smart contracts sector to get the most from the next market rebound.”Given the current macro backdrop, leverage within the Bitcoin market, and recent robustness seen in the altcoin market, we think it’s appropriate to be overweight Ethereum and other smart contract platforms,” they said in a note, adding:”We probably would not bet the farm near-term on Bitcoin but think there is an opportunity in going long volatility via derivatives strategies.”The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Fed chair Jerome Powell says he isn't concerned about crypto disrupting financial stability in the US

United States Federal Reserve chair Jerome Powell hinted that though the government agency should consider monitoring developments in the crypto space, he didn’t see cryptocurrencies as a financial stability concern for U.S. markets.Addressing a question on crypto from Michael Derby of the Wall Street Journal on Tuesday, Powell supported the conclusions of a report from the President’s Working Group on Financial Markets released on Nov. 1. The report proposed that stablecoin issuers should be subject to “appropriate federal oversight” akin to that of banks, legislation that was “urgently needed” to address risks.“Stablecoins can certainly be a useful, efficient consumer-serving part of the financial system if they’re properly regulated,” said Powell. “Right now, they aren’t. They have the potential to scale, particularly if they were to be associated with one of the very large tech networks that exist.” Jerome Powell speaking at a Tuesday news conferenceThe Fed chair added:“You could have a payment network that was immediately systemically important that didn’t have appropriate regulation and protections. The public relies on the government and the Fed in particular to make sure that the payment system is safe and reliable.”Powell seemed to be backing the Biden administration’s most recent position on digital assets in advance of his Senate confirmation hearing to be the next Fed chair. Having served on the Fed’s board of governors since 2012 and as chair since 2018, Powell is the U.S. President’s pick to serve in the same role until 2026.Related: Fed still undecided about digital dollar, says Chair Jerome PowellThough the Fed chair said that crypto was likely not a financial stability concern for the U.S. at the moment, he still described digital currencies used as speculative assets as “risky” and “not backed by anything.” Powell has previously stated his concerns about crypto — adding he would not be in favor of banning the assets the way China has — while voicing the need for regulation of stablecoins.“Stablecoins are like money market funds, they’re like bank deposits, but they’re, to some extent, outside the regulatory perimeter, and it’s appropriate they be regulated,” said Powell in September. “Same activity, same regulation.”

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