Latest news about Bitcoin and all cryptocurrencies. Your daily crypto news habit.
The New York Times is reporting President Trump will appoint âJerome H. Powell as the next chairman of the Federal Reserve (Fed).â Bitcoiners all over the world will be impacted.Â
Also read: Federal Reserve Chair Photo Bomber Generates Over $15k
Potential Trump Nominee Powell is Cautious about Bitcoin
President Trump is widely expected to nominate Federal Reserve Board of Governors member, Jerome H. Powell, for Senate confirmation as the next chair of the Federal Reserve. The potential Fed chair has previously stated what he sees as a tension with bitcoin as the Fed âcould face difficult trade-offs between strengthening security and enabling illegal activity.â
Mr. Powell has held a Fed governorâs seat since 2012, and is currently at the relative beginning of a term that would have kept him installed until 2028.
Governor Powell appears familiar with bitcoin as a currency and Bitcoin as a network.
Current Fed chair is bitcoin photo-bombed while testifying.
This spring, he gave a talk titled Innovation, Technology, and the Payments System for the Yale Law School Center for the Study of Corporate Law, during nearly half of which he spent discussing âdistributed ledger technologiesâ (DLT) and âdigital currencies.â
âBitcoin helped bring [DLT] to public attention,â the governor began. âUsing blockchain technology â which employs a form of DLT â and an open architecture, Bitcoin allows for the transfer of value (bitcoins) between participants connected to its ecosystem without reliance on banks or other trusted intermediaries,â he outlined.
Is the Fed and its Banking System Obsolete?
Mr. Powell continued, âThis feature has led some to predict that DLT will, in the long run, render parts of the banking and payments system obsolete, as the intermediation of funds through the banking system will become unnecessary.â
After detailing a few of last yearâs institutional experiments with bitcoin, his remarks then turned to lessons taught by the worldâs most popular cryptocurrency.
âFirst, in contrast to Bitcoinâs open architecture, work by the financial industry has focused on the development of âpermissionedâ systems, which establish criteria to determine who is permitted access to particular systems, ledgers, functions, or information,â he noticed.
âSome argue that in certain markets, faster and more predictable processing will also reduce the capital and liquidity costs of operations,â the governor said. However, âtechnical issues remain,â such as âreliability, scalability, and security remain very important. Beyond these issues, standardization and interoperability across different versions of DLT will need to be addressed to allow technology integration and avoid market fragmentation,â Mr. Powell explained.
Appealing to his law school audience, he stressed the âneed [for] a thorough analysis of how DLT fits into current legal frameworks and what gaps need to be filled by contractual agreements or new laws and regulations [emphasis added].â
Lastly, Governor Powell discussed a possible future state-backed digital currency.
âAdvanced cryptography could reduce vulnerability to cyber attacks,â he insisted, âbut make it easier to hide illegal activity. To the extent we relax strong cryptography to make it easier for authorities to monitor illegal activity, we could simultaneously weaken security.â
The governor wasnât all negative, concluding that we âlive in a time of extraordinary technological change. We should be open to the new ideas and innovations that will drive economic growth and improvements in our financial system,â he said.
What are your thoughts about Trumpâs pick for the Fed? Tell us in the comments below!
Images courtesy of Pixabay, The Bipartisan Policy Center, Cspan.Â
At Bitcoin.com thereâs a bunch of free helpful services. For instance, check out our Tools page!
The post Trump to Appoint Bitcoin-Skeptic Powell as Fed Chair appeared first on Bitcoin News.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.