Blow To Bitcoin As Fed Chair Jerome Powell Issues Strong Facebook Warning
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Bitcoin has been rallying so far this year largely due to the renewed interest in bitcoin and cryptocurrencies sparked by social media giant Facebook's much -hyped Libra cryptocurrency project, which was unveiled last month
The bitcoin price, which had struggled through a bitter bear market throughout 2018, has added over 250% so far this year but continues to swing wildly as traders and investors attempt to find steady ground and has l cheese some 10% over the last 24-hour trading period .
Now, the US Federal Reserve chairman Jerome Powell has announced the Facebook Libra project " cannot go forward " until serious concerns " are sent – the bitcoin price down & nbsp; 7% over the course of his three-hour semi-annual testimony on monetary policy before the U .S. House of Representatives Financial Services Committee
Federal Reserve chairman Jerome Powell made the comments about Facebook's planned bitcoin rival during a House Financial Services Committee hearing.
Getty
" Libra raises many serious concerns regarding privacy, money laundering, consumer protection, and financial stability, "Powell warned, added he doesn't think " the project can go forward [these are addressed].
Bitcoin and cryptocurrency traders and investors were perhaps spooked by & nbsp; Powell's comments that the Fed's existing rules do not fit digital currencies, warning issues could " arise to systemically important levels just because of the more size of Facebook. "
" It's something that doesn't fit neatly or easily within our regulatory system, but it does have potentially systemic scale, he said. " It needs a careful look, so I strongly believe we need to take our time with this. "
The US —which accounts for around & nbsp; 26% of bitcoin activity, according to data provider Cryptocompare — has struggled with bitcoin and cryptocurrency regulation, with the country's regulators failing to come to a consensus on how to act bitcoin and its crypto peers.
Powell's comments could indicate the Fed and other US watchdogs might be looking to clamp down on bitcoin in coming months
Powell added that the Fed is working with other central banks around the world, with India already suggesting the bitcoin
Earlier this year, Christine Lagarde, who has just been nominated to replace Mario Draghi as president of the European Central Bank (ECB), warned that cryptocurrencies are Shaking the system " —something that could signal a change in the ECB's approach to bitcoin and crypto .
Last week in ECB & nbsp; up call " to regulators and it could not operate in " void " outside the typical structure of central banks.
The bitcoin price moved sharply lower throughout the Fed chair's testimony.
CoinDesk [19659017] Facebook officials are schedu led to speak before U.S. Congress this month about the bitcoin rival Libra project, just a little over a year since Facebook's chief executive, Mark Zuckerberg, faced & nbsp; U.S. lawmakers on the company's data-sharing scandal
Facebook officials appeared to welcome the scrutiny, expressing the desire to work with governments in order to meet Libra's planned 2020 launch date.
" We are very much aligned with the chairman around the need for public discourse on this, " Facebook spokeswoman Elka Looks said in an email to Reuters . " This is why we along with the 27 other Founding Members of the Libra Association made this announcement so in advance, so that we could engage in constructive discourse on this and get feedback. "
Meanwhile, & nbsp; Powell caught the attention of markets around the world yesterday when it signaled the Fed could soon cut interest rates, sending global stocks higher and pushing the benchmark S&P 500 stock index & nbsp; over 3,000 for the first time.
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Bitcoin has been rallying hard so far this year, due to the renewed interest in bitcoin and cryptocurrencies sparked by social media giant Facebook's much-hyped Libra cryptocurrency project, which was unveiled last month.
The bitcoin price, which had struggled through a bitter bear market throughout 2018, has added over 250% so far this year, but continues to swing wildly as traders and investors attempt to find steady ground and has lost some 10% over the last 24-hour trading period.
Now, U.S. Federal Reserve chairman Jerome Powell has warned the Facebook Libra project "cannot go forward" until the "serious concerns" are addressed – the bitcoin price down monetary policy before the US House of Representatives Financial Services Committee
Federal Reserve chairman Jerome Powell made the comments about Facebook's planned bitcoin rival during a House Financial Services Committee hearing.
Getty
"Libra raises many serious concerns regarding privacy, money laundering, consumer protection, and financial stability, "Powell warned, added he doesn't think" the project can go forward "until these are addressed.
Bitcoin and cryptocurrency traders and investors were perhaps spooked by Powell's comments that the Fed's existing rules do. not fit digital currencies, warning issues could "arise to systemically important levels just because of the more size of Facebook." "It's something that fits neatly or easily within our regulatory system but it does have potentially systemic scale, "he said." It needs a careful look, so I strongly believe we need to take our time with this. The process of addressing these concerns is a patient and careful one, not a sprint. "The US —which accounts for around 26% of bitcoin activity, according to data provider Cryptocompare — has struggled with bitcoin and cryptocurrency regulation, with the country's regulators failing to come to a consensus on how to handle bitcoin and its crypto peers. "
Powell's comments could indicate the Fed and other US watchdogs might be looking to clamp down "
Powell added that the Fed is working with other central banks around the world, with India already suggesting the bitcoin rival will not be permitted in the country.
] Earlier this year, Christine Lagarde, who has just been nominated to replace Mario Draghi as president of the European Central Bank (ECB), warned that cryptocurrencies are "shaking the system" —something that could sign The ECB's approach to bitcoin and crypto
Last week an ECB executive described Libra as a "wake-up call" to regulators and it could not operate in a "void" outside the typical structure of central banks
The bitcoin price moved sharply lower throughout the Fed chair's testimony.
CoinDesk
Facebook officials are scheduled to speak before US Congress this month about the bitcoin rival Libra project, just a little over a year since Facebook's chief executive, Mark Zuckerberg, faced U.S. lawmakers on the company's data-sharing scandal
Facebook officials appeared to welcome the scrutiny, expressing the desire to work with governments in order to meet Libra's planned 2020 launch date.
"We are very much aligned with the chairman around the need for public discourse on this, "Facebook spokeswoman Elka Looks said in an email to Reuters. "This is why we along with the 27 other Founding Members of the Libra Association made this announcement so far in advance, so that we could engage in constructive discourse on this and get feedback."
Meanwhile, Powell caught the attention of markets around the world yesterday when it signaled the Fed could soon cut interest rates, sending global stocks higher and pushing the benchmark S&P 500 stock index over 3,000 for the first time.
