[서울신문] Bitcoin Beaton’Powell Power’

On the warning of “volatility large speculative assets” cryptocurrency
Bitcoin price plunges 7% in one day
“The Fed is also researching’digital currency’ with MIT.”

AP Yonhap News” style=”padding:0px;margin:0px”>

▲ Jerome Powell, Chairman of the Federal Reserve Board of the United States.
AP Yonhap News

Jerome Powell, chairman of the Federal Reserve Board (Fed), warned of the dangers of cryptocurrency investment.

Chairman Powell attended the BIS video conference on the 22nd (local time) and said, “Virtual currencies are very volatile,” and “we need to recognize the risks of cryptocurrencies such as Bitcoin.” He added that “the Fed prefers to call it virtual assets.” The reason is that it is difficult to function as a basic function of money that stores value due to the high volatility of virtual currency. He evaluated that “virtual currency is more of a speculative asset, a substitute for gold, rather than the dollar.” After his remarks, the price of bitcoin plummeted. As of the morning of the 23rd, bitcoin is trading at 53,000 dollars (about 5984 million won), which is 7% lower than 24 hours ago.

Chairman Powell said the Fed is also working on digital currency. He said the Fed’s technical lab is working on digital currency, and the Federal Reserve Bank of Boston and Massachusetts Institute of Technology (MIT) are also working on digital currency. “No decision has been made at this time,” he said. To proceed with this, it needs to be approved by the Congress, the government and the wide public.

Chairman Powell said, “To introduce digital currency at the central bank level, the legislative process comes first. We will not move without the support of Congress. Ideally, there is a legal foundation in place.”

Despite China’s active digital currency, the Fed emphasized that there is no need to take the lead in introducing digital currency. He was also concerned about the possibility that digital currency could be exploited for hacking, money laundering, and terrorism, leaving the central bank out of control.

Senior Reporter Kyu-Hwan Kim [email protected]