Kofi Mensah Jerome Powell, the Chairman of Federal Reserve, said that crypto activities have some risks, like confusion, cheating and not being clear on how it functions. He also reminded us that we should not use regulations to stop change and improvement.
Fed Warns of Risks Involved with Cryptocurrency Investments
Tuesday, the Federal Reserve Chairman Jerome Powell talked to the Senate Banking Committee about cryptocurrency. The Chairman of the committee, Senator Sherrod Brown from Ohio asked Powell questions about the danger that cryptocurrencies might cause and how the Fed is watching out for banks related to them.
Fed Chair Powell said that the Fed views innovation and growth positively, but they want to make sure regulations don’t just help those who already have an advantage. He also mentioned that the market for cryptocurrencies is not very transparent and comes with lots of risks – like fraud and scams.
The Federal Reserve has been watching over banks and regulated financial institutions to make sure they are aware of risks related to cryptocurrency. They also posted special notices, together with the FDIC and OCC, as a warning about such risks.
In February, the Federal Reserve (Fed), Federal Deposit Insurance Corporation (FDIC) and Office of the Comptroller of Currency (OCC) gave a warning about potential unsafe money issues related to cryptocurrencies. These three organisations warned people to be more careful with cryptocurrency investments, saying there should be clear rules put in place like board oversight, risk assessments and monitoring.
What do you think about Federal Reserve Chairman Jerome Powell’s statements concerning cryptocurrencies? Write your opinion down in the comments section below!
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