US Senator Bill Hagerty said he will discuss cryptocurrencies along with the Fed’s interest rate plans at the hearing on The Semiannual Monetary Policy Report to Congress.
Federal Reserve Chairman Jerome H. Powell is all set to participate in the open session to be held on Tuesday, 7 March 2023. While the market would be waiting to get the Fed’s view on the interest rate hike plan for the rest of the year, Powell’s comments on the crypto market could also come as a key development. The Fed Chair’s comments come at the back of his views from September 2022, when he said there was a need for better regulation of cryptocurrencies.
The hearing will also be important given the US Securities and Exchange Commission’s (SEC) series of regulatory enforcement actions on the crypto industry in recent times.
While the crypto companies are increasingly facing difficulty to operate with US Dollar linked transactions owing to the lack of willingness from US banking partners, other issues like lack of regulatory clarity continue.
When the Senate committee on banking, housing, and urban affairs meets for the hearing of Jerome Powell, the big question will be about the central bank’s views on the state of the US economy. And the Fed’s plans to steer the economy in a balance between controlling inflation while raising interest rates. Going by the trends around recent monthly rate hike announcements, Powell’s speeches after the FOMC meets itself have a significant impact on crypto prices.
The Senator said he will discuss crypto with the Fed Chair during the hearing. In this context, if Powell makes his intentions clear about crypto regulation and the associated risks, there could be a chance for a slight dip in crypto prices if not a full-fledged crypto crash.
In his statements during a panel discussion in September 2022, he warned that the next crypto bloodbath could potentially have broader market consequences.
Senator Hagerty is known for his support of the crypto ecosystem. Recently, he spoke against the difficulty of crypto exchanges to find banking partners, saying the companies are “being debanked by US banks due to political pressure.” Hence, Powell’s hearing could take interesting turns when the Senator grills the central bank chief on crypto.
