Federal Reserve Chair Jerome Powell has once again reiterated the central bank’s position on Bitcoin, clarifying that U.S. laws currently prohibit the Fed from owning or managing a Bitcoin reserve.
Speaking at a routine press conference following the latest Federal Open Market Committee (FOMC) meeting, Powell emphasized that the Federal Reserve is not authorized to hold Bitcoin. He explained that existing legal frameworks do not allow the central bank to create or manage a Bitcoin reserve. Powell also made it clear that the Fed is not advocating for any changes to these laws that would enable the establishment of a government-managed Bitcoin stockpile.
Powell’s remarks came shortly after the Fed’s decision to cut interest rates by 25 basis points. Following the announcement, Bitcoin saw a sharp decline, dropping by 2.1% in just an hour and hovering around $101,400 at the time of writing.
While Powell’s position on Bitcoin is not new, his comments have gained renewed attention in light of recent discussions surrounding Bitcoin reserves in the U.S. This is particularly timely given former President Donald Trump’s proposal for a national strategic Bitcoin reserve, a plan that has garnered support from certain lawmakers, including Senator Cynthia Lummis, and some figures within the cryptocurrency industry.
However, not everyone is on board with the idea. Crypto experts like Nic Carter, founding partner at Castle Island Ventures, have expressed skepticism. Carter warned that creating a U.S.-managed Bitcoin reserve could undermine confidence in the U.S. dollar and its status as the global reserve currency.
Despite the debate surrounding a potential national Bitcoin reserve, Powell’s comments underscore the Fed’s ongoing position: under current laws, the central bank cannot hold or manage Bitcoin, and it has no plans to pursue such a policy shift.