“The current US economy is still far from a full recovery,” said Jerome Powell, chairman of the US Central Bank (Fed). In addition to the monetary expansion policy, government support must continue. Cryptocurrency (virtual currency), which has increased in price since the end of last year, was devalued as “it is only a speculative asset with high volatility.”
Chairman Powell diagnosed the recent economic situation in the answer to the hearing submitted before attending the House Financial Committee on the 22nd (local time). He said, “It is true that the economic recovery has progressed faster than expected, but the sectors hit by the Corona 19 crisis are still vulnerable.” “Even though the labor market participation rate is below the level before the pandemic (the pandemic), the employment crisis is being underestimated.”
On this day, Chairman Powell expressed a critical view of cryptocurrency at a video forum held by the International Settlement Bank (BIS) on the topic of digital banking. “Cryptocurrency is very volatile, so it cannot be viewed as a useful store of value,” he said. “It is not a substitute for the dollar.” He added, “It will be close to a speculative asset that is a substitute for gold.” Regarding the digital currency being developed by the Fed, he said, “the final model will be released two years later,” he said. “But first, it needs to get approval from the Congress, the government, and the public.”
After US Treasury Secretary Janet Yellen and Chairman Powell expressed negative views, the cryptocurrency market turned to a weaker mood. Minister Yellen raised the need for regulation last month, saying, “Bitcoin is not only an extremely inefficient means of trading, but it can also be exploited for illegal finance.”
New York = Correspondent Jae-Gil Cho [email protected]
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