Fed not allowed to own Bitcoin

Federal Reserve chairman Jerome Powell reiterated the bank’s position regarding Bitcoin reserves from the current legal perspective.

Speaking at a routine conference after the monetary decisions were announced, Fed chairman Powell stated that the US central bank cannot own Bitcoin (BTC) and therefore cannot hold BTC reserves.

The banking regulator emphasized that current laws do not allow Fed BTC reserves. Powell added that America’s apex bank is also uninterested in any legislative changes that would allow officially recognized, government-run BTC stocks.

Powell shared these statements shortly after the last Federal Open Market Committee meeting of the year, where the Fed announced a 25 basis point cut in interest rates. Bitcoin continued its downward trend following the interest rate cut news, dropping 2.1% in an hour and was hovering around $101,400 as of writing.

24-hour BTC price chart – December 18 | Source: crypto.news Powell’s Bitcoin comments are not new

This is not the first time Powell has made these statements. Fed Powell has made the same statement many times before in post-FOMC meetings.

But this is one of the first times Powell has said this since the United States elected Donald Trump as the 47th president. Powell’s comments likely attracted attention this time because of Trump’s national strategic Bitcoin reserve plan.

While widely supported by lawmakers like Senator Cynthia Lumiss and industry leaders at large, a few crypto experts like Castle Island Venture co-founder Nic Carter were skeptical of the move. Carter noted that creating a US-managed BTC reserve could raise doubts about the strength of the dollar and its role as a global reserve currency.