Fed Chair Powell addresses concerns over permissionless distributed ledgers in Senate hearing News ▸ US ▸ Regulation
Fed Chair Powell addresses concerns over permissionless distributed ledgers in Senate hearing
Powell urges Congress to create a workable legislative framework for digital assets, as US lags behind UK, EU, Switzerland, and Singapore.
1 min read
Updated: Jul. 24, 2023 at 6:19 pm UTC
Federal Reserve. Remixed by CryptoSlate
Federal Reserve chair Jerome Powell spoke on March 7 in front of a Senate Banking, Housing and Urban Affairs Committee.
During the hearing, he was questioned by Senator Cynthia Lummis (R-Wyoming) about permissionless distributed ledgers and whether they had any place within the financial system.
Powell said:
“There are real concerns about permissionless public blockchains, and the reason is that they’ve been so susceptible to fraud, to money laundering and all of those things. I think what you heard from the federal banking agencies in one of their reports was that they would tend to look at those as inconsistent with safety and soundness.”
On stablecoins, Powell said that with “appropriate regulation,” they could merge with traditional banks.
“Where stablecoin activity gets the same regulation as comparable products in different places, then there certainly could be a place for stablecoins in our financial services sector,” the Fed chair said.
Lummis also pressed Powell on the need for digital asset regulation. She compared the US to other jurisdictions like the UK, the EU, Switzerland and Singapore, all of which have moved in the last several years to create legislative frameworks for digital assets, while the US has lagged.
“I do think it would be important for us to have a workable legal framework around digital activities,” Powell added. “I think that is important and something Congress in principle, needs to do, because we can’t really do that.”
Author 
Dorian Batycka
Dorian Batycka is a journalist interested in art and technology. He has previously contributed to CoinDesk, Decrypt, Artforum, Artnet News, the Art Newspaper, and many others. He can be found on Twitter and Instagram @temp_projects, where he often memes his way through current financial and art news, scandals, and events.
