As a seasoned financial analyst with over two decades of experience navigating global markets, I must admit that the recent endorsements by Jerome Powell and Vladimir Putin of Bitcoin are nothing short of groundbreaking.
Yesterday, two highly influential global leaders – US Federal Reserve Chair Jerome Powell and Russian President Vladimir Putin – unexpectedly expressed support for Bitcoin during separate events on December 4, 2024. Their acknowledgments of the cryptocurrency’s increasing importance suggest a possible transformation in the world financial system, as Bitcoin continues to gain traction among mainstream audiences.
Jerome Powell Compares Bitcoin To Gold
At the New York Times DealBook Summit, Jerome Powell held a discussion with Andrew Sorkin on the subject of cryptocurrencies within the banking system. When asked about Bitcoin’s growing influence and discussions in Washington concerning the establishment of a strategic BTC reserve, Powell shared the Federal Reserve’s viewpoint.
According to Powell, when it comes to our professions, there are essentially two key points that matter. Firstly, it’s important to determine how cryptocurrencies can be integrated into the banking sector. We aim to ensure the stability of the banking system, so we regulate and oversee banks, and we want any connection between crypto businesses and banks not to jeopardize the safety and health of the banks.
Powell also noted that another duty of the U.S. Federal Reserve involves safeguarding consumers. “It’s important for people to be aware of cryptocurrencies and similar products. There is indeed a consumer protection aspect to this, as understanding these products is crucial. However, we do not have direct control over them, nor do we play a significant role in their regulation.
When asked if he would ever own Bitcoin himself, Powell succinctly replied, “I’m not allowed to.”
Later on, Sorkin proposed that Bitcoin could represent individuals’ trust or distrust in the U.S. dollar or the Federal Reserve. In response, Powell compared Bitcoin to a traditional form of value storage: “I don’t believe people view it as such. To put it simply, people treat Bitcoin more like an investment, similar to gold. It’s just digital, virtual. Most people aren’t using it for transactions or as a means of storing value. It’s extremely volatile and not a rival to the dollar. Instead, I see it more as a competitor to gold.
Vladimir Putin Highlights Bitcoin’s Resilience
On the very same day, President Vladimir Putin addressed the Russia Calling forum, a platform where he touched upon the declining supremacy of the US dollar and the growing popularity of alternative monetary tools. Putin underscored the imminence of innovative technologies like Bitcoin in transforming the worldwide economic landscape.
Putin pointed out that having the dollar as a global currency provides the US with considerable financial advantages, enabling them to leverage other world economies for their benefit. He suggested two options: either banning the usage of dollars or simply not using it. This is why we observe economic activities utilizing alternative tools instead.
He also mentioned, “For example, consider Bitcoin or other digital forms of payment – no one has the power to outlaw them. These are advanced technologies that continue to evolve, regardless of the fate of traditional currencies like the dollar. People will always seek ways to cut costs and improve reliability, which drives these tools’ development.
Additionally, Putin observed a worldwide trend of nations, even U.S. allies, diminishing their holdings of both U.S. dollars and euros in their foreign reserve assets.
Today…
Jerome Powell: “It functions similarly to gold, but it’s in a digital format instead. Right now, it isn’t being utilized as a means of exchange or for storing value. It exhibits significant price fluctuations. It doesn’t pose a threat to the dollar. Rather, it poses a challenge to gold.
Vladimir Putin: “For example, Bitcoin, who…
— Sam Callahan (@samcallah) December 4, 2024
Reactions From Community
Prominent figures in the cryptocurrency world swiftly responded after endorsements from Powell and Putin. Vijay Boyapati, a renowned author and ex-Google engineer who penned The Bullish Case for Bitcoin, shared his views on platform X: “Jerome Powell labeling Bitcoin as ‘digital gold’ is the most significant endorsement of Bitcoin so far, if you recognize where financial influence resides. More impactful than Fink or even Trump.
David Bailey, CEO of BTC Inc and advisor to the former Trump team – who played a key role in making Trump supportive of Bitcoin – expressed his thoughts via X: “The competition for dominance in Bitcoin is now underway. […] There’s no mistaking what’s happening. It’s crucial for the U.S. administration to establish a Strategic Bitcoin Reserve within the first 100 days, and we should have an ambitious strategy to increase America’s share of the Bitcoin supply.
At press time, BTC traded at $102,335.
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2024-12-05 15:12