US Federal Reserve Chairman Jerome Powell has proudly announced that bitcoin and other cryptocurrencies "completely failed" to become a common means of payment, adding that the crypto market no longer poses a threat to the US dollar.
According to him, cryptocurrencies are only used for anonymous transactions. Powell is confident that the greenback's status as a reserve currency has no rivals. However, he is concerned about the implementation of digital assets. "I think it’s way more important to do it right, than to do it fast," the head of the Fed said, reporting to Congress on the state of the economy.
Powell expresses strong confidence in the US dollar. In his opinion, the American currency will not lose its dominance even if CBDCs are accepted by many other countries. Rather than discussing the "failed currency", he suggested focusing on regulating the stablecoin market. Noting that stablecoins might become "a significant part of the payments universe", Powell argued a clear need for a strong regulatory framework. They should be regulated on an equal basis with bank deposits and mutual funds, he added.
Despite the crackdown of the authorities of developed economies on cryptocurrencies and exchanges, senior banking officials still confirm that cryptocurrencies are not yet big enough to pose a systemic risk to financial stability. Probably that is why there is no tough regulation of digital currencies around the world yet.
