Fed Chair Powell Is No Fan Of Bitcoin; It's Good For Money Laundering
(Kitco News)- Momentumin bitcoin is starting to shift as prices have bounced off June’s nearlyone-year low; however, despite the positive price action, one person remains acritic of the cryptocurrency: Jerome Powell.
Inthe last four days, bitcoin has rallied more than 19% as prices push above$7,000 per token, its highest level since mid-June, according to aggregatedprice charts on Kitco.com.
Duringhis testimony before the House Committee on Financial Services, the chairman ofthe Federal Reserve was asked for his opinion on cryptocurrencies and he hadfew kind words for the sector.
"Cryptocurrenciesare great if you are trying to hide money or launder money,” said Powell duringhis testimony.
Headded that he doesn’t see cryptocurrencies as a store of value and the sectorposes a significant investment risk for investors.
Heexplained that investors just have to look at the price action over the pastyear to see the risk and volatility in the digital marketplace.
Whilebitcoin has bounced off last month’s lows, the price is still down almost 61%from its December highs.
Asignificant problem with cryptocurrencies, Powell said is that they do not haveany intrinsic value. He added that it’s not even a reliable payment system asbitcoin are eventually sold for U.S. dollars.
Inhis final comment about the sector, Powell said that the Federal Reserve is notlooking at creating a creating a digital currency.
Powellhas generally been upbeat in his assessment of the U.S. economy and labormarket in his semi-annual testimony before Congress. In his prepared remarks,he noted that in the current environment the Fed’s “best way forward,” is tocontinue to raise interest rates gradually.
InJune the U.S. central bank signaled that it could raise interest rates two moretimes this year.
For Kitco News
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