Jerome Powell: Bitcoin Compared to Gold, Not Dollar

Powell’s View on Bitcoin

During the DealBook Summit, Federal Reserve Chair Jerome Powell discussed the nature of Bitcoin, likening it to gold rather than the U.S. dollar. He stated that people treat Bitcoin as a speculative asset, similar to virtual and digital gold.

Bitcoin vs. U.S. Dollar

Powell clarified that Bitcoin does not pose a threat to the Federal Reserve or the strength of the U.S. dollar. He emphasized that Bitcoin is not widely used for transactions or as a stable store of value due to its high volatility.

Bitcoin and Gold

Contrary to popular belief, Powell asserted that Bitcoin is more of a competitor for gold than for the dollar. He explained that the cryptocurrency market should not endanger the traditional banking system, as the Federal Reserve’s primary concern is the safety and soundness of the financial institutions.

U.S. Economy and Powell’s Perspective

Powell expressed optimism regarding the current state of the U.S. economy, citing stable growth and decreasing inflation rates. He highlighted the annual growth rate of approximately 2.5%, a decrease in inflation from over 7% to around 2.3%, and steady unemployment figures as indicators of economic stability.

Powell emphasized the Federal Reserve’s cautious approach in setting interest rates to maintain economic progress without jeopardizing inflation levels or the labor market.

Powell’s Position on Bitcoin Ownership

When asked whether he owns any Bitcoin, Powell stated that he is not permitted to own the cryptocurrency. He also touched upon the Federal Reserve’s non-regulatory role in the cryptocurrency industry.

Overall, Powell’s remarks shed light on the relationship between Bitcoin, gold, and the U.S. dollar, while also providing insights into the current economic conditions and the Federal Reserve’s policy approach.