Jerome Powell, Federal Reserve Chair. Kevin Lamarque/Reuters
Jerome Powell, Fed Chairman, stated to Congress that the central bank does not intend to ban cryptocurrency.
Answered by Ted Budd, a North Carolina House Representative, the answer was "Yes."
Powell said that stablecoins also need to be regulated and compared them to money market funds.
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On Thursday, the long-held belief that the US government will ban cryptocurrency was tested. It is similar to making gold illegal in 1933.
Jerome Powell, the Chairman of Federal Reserve, testified before Congress Thursday that the central bank had "no intention" ban cryptocurrency. This was in response to Ted Budd, a North Carolina House Representative.
"As a matter policy, do you intend to ban or limit cryptocurrency use like what we see in China?" Powell was questioned by Budd.
Powell replied, "No intention [to ban them]."
Powell does not believe they should be exempted from regulation as Gary Gensler, the SEC Chairman, has suggested. Powell referred to stablecoins specifically, comparing them to money market funds. They need to be regulated.
"Stablecoins, which are similar to money market funds, are comparable to bank deposits but they are still outside of the regulatory framework and should be regulated. Powell stated that the same activity requires the same regulation.
These comments are made as the Fed continues to examine the potential uses of a central bank digital cryptocurrency similar to cryptocurrencies.
