U.S. Federal Reserve Chairman Acknowledges Cryptocurrency Potential, Bitcoin Again Pumping Up

US Federal Reserve Chairman Jerome Powell confirmed at the House Financial Services Committee yesterday that it is the bureau’s obligation to study the central bank’s digital currency (CBDC). With the current developments of the technology, there is an opportunity to make CBDC feasible. The cryptocurrency market and Bitcoin rose again, at the current time of posting 10:00 AM PST, $10,328.33.

Powell mentioned at the meeting that the Fed and other central banks have a responsibility to understand the related costs, benefits, and choices of the CBDC. He pointed out that Facebook’s Libra has awakened global attention, the advent of digital currencies is fast, and it has a widespread and important position on the system. However, he also indicated that there are still many problems around digital currencies, and the US dollar is still the core of the US financial system and serves the market well. Therefore, there is no specific timetable for launching the US CBDC for the time being.

At the same time, Powell believes that anonymous transactions in cryptocurrencies can protect the privacy of users and do not require everyone to know the transactions of others. This can increase users’ interest in using cryptocurrencies. The cryptocurrency market also immediately responded to Powell’s remarks. Bitcoin rose to its highest level since late September last year, and the transaction volume in the past 24 hours was $42.99 billion. Other cryptocurrencies have also made significant gains, with Ethereum up nearly 15% to $ 263.84, and Cardano and Stellar also rising more than 10%.

At yesterday’s meeting, some lawmakers also paid attention to China ’s ambition to develop the CBDC, especially it’s One Belt One Road policy. It has the opportunity to promote the internationalization of the RMB and fear that it will threaten the US dollar’s status in the future. In response, Powell said that the Fed is trying to keep up with China’s development in related areas, and many projects under its management are being promoted.