Bitcoin, Cryptocurrencies and Interest Rate Statements from Top Level FED Members Arrived!

FED members Christopher Waller and Austan Goolsbee expressed their views on key economic issues such as stablecoin regulation, inflation, and monetary policy in their recent statements.

Waller emphasized the importance of regulating stablecoins, which he described as a 'synthetic dollar' with the potential to make payments faster and cheaper. While acknowledging their benefits, Waller stated that stablecoins require urgent regulatory oversight, saying 'The sooner, the better'.

In addition, Waller noted that stablecoins could further enhance the position of the US dollar as the world's reserve currency. However, when asked about the possibility of the US creating a strategic Bitcoin reserve, he firmly rejected the idea from the Fed's perspective, stating that the Fed would not implement such a project.

The central bank reiterated its skepticism about (CBDCs), saying that the United States does not need to launch a individual CBDC.

By the way, Austan Goolsbee stated that the US economy has achieved full employment and stability in the labor market, offering an optimistic outlook. He stated that the economy has reached "full employment, continued growth, and the possibility of inflation falling to 2%."

Goolsbee also addressed concerns about inflation, explaining that the recent phenomenon of sluggish inflation is largely due to base effects. Additionally, he noted that customs tariffs could impact inflation, but their direct effects on prices may be less significant than market expectations.

On the subject of interest rates, Goolsbee pointed out that long-term interest rates are shaped by complex market forces rather than direct actions by the Fed. However, he said he would be most concerned if long-term interest rates were to rise along with inflation expectations, but that has not yet happened.

In addition, Goolsbee suggested that the pace of interest rate cuts should be slowed down to find an appropriate stopping point, acknowledging that the current FED policy rate is significantly higher than the neutral interest rate.