Bitcoin’s price took a tumble after Federal Reserve Chair Jerome Powell declared the central bank can’t legally hold Bitcoin.
Powell Says No Bitcoin for the Fed
Following a rate cut announcement, Powell addressed questions about the Fed potentially investing in Bitcoin. He stated plainly that current laws prevent the Fed from owning Bitcoin. The Federal Reserve Act specifically outlines what assets the Fed can hold, and Bitcoin isn’t on the list. Powell emphasized that only Congress could change this, and the Fed isn’t pushing for such a change.
Market Reaction and Other Views
Powell’s statement caused a noticeable dip in Bitcoin’s price, dropping it from around $103,700 to as low as $100,241 within an hour. This contrasts with President-elect Trump’s earlier suggestion that the US should hold seized Bitcoin as an investment rather than selling it. While Trump has expressed interest in a strategic Bitcoin reserve, he hasn’t commented on whether the Fed or Treasury should manage it. Senator Cynthia Lummis has proposed legislation to have the Fed purchase a million Bitcoins over five years, but its chances of passing remain uncertain.
Disclaimer
This information is for general knowledge and shouldn’t be considered investment advice. Investing in cryptocurrencies is risky, and you could lose money. Always do your own research before making any investment decisions.
