Federal Reserve Chairman Jerome Powell argues the cryptocurrency is unsuitable as a store of value because of its volatile nature and is not backed by anything.
His opinion was expressed in a discussion conducted virtually by the Bank for International Settlements last night Malaysian time.
However, Powell acknowledged Bitcoin (BTC) is starting to outperform gold, describing the digital asset as a substitute for gold against the dollar.
Stablecoins, also known as an innovation in the crypto sector because it relies on fiat currencies also caught Powell’s attention.
“Stablecoin is backed by fiat currencies from major countries and of course it is a good innovation in the crypto sector. Its credibility comes from the fiat currency as support. ”
In contrast to other countries that are already active in the production of central bank digital currency (CBDC) such as China, Japan and Russia, Powell said the Fed wants to act more cautiously on the production of CBDC or digital dollars.
However, there is a bright opportunity for digital dollars to be introduced in the future.
The Federal Reserve Bank of Boston and the Massachusetts Institute of Technology have reached a final word to make the study more transparent as well as outline stricter laws, similar to existing stablecoins.
At the time of writing, several cryptocurrencies are traded on:
BTC: $ 55,513 (down 2.14%)
ETH: $ 1,717 (down 2.77%)
XRP: $ 0.596 (up 17.91%)
LTC: $ 189 (down 2.03%)
