Jerome Powell confirms the Fed is studying stablecoin risks, as Ripple dives in the ring for CBDCs' support


  • The Fed is looking keenly at stablecoin regulations as it works closely with other global banks.
  • The Fed Chairman, Jerome Powell, says that the Fed prefers to be right and not quick with a CBDC.
  • Ripple presents the XRP Ledger for stablecoin and CBDCs' issuance.

The Chairman of the United States Federal Reserve, Jerome Powell, says that the ongoing work regarding stablecoins is of "very high priority. Moreover, the institution has been working on "better regulatory answers for potential global stablecoins particular," during a webinar held on Thursday.

The Fed's attention shifts to CBDC's and stablecoin regulation

According to Powell, central bank digital currencies (CBDC's) and stablecoins bring with them risks that have to be mitigated. The Fed is working hand in hand with other central banks worldwide because it is aware that stablecoins could become significant overnight, and it must be ready as a regulator.

So that's been a high-level focus, and that will continue to be a high-level focus because they could become systemically important overnight, and we don't begin to have, you know, our arms around the potential risks and how to manage those risks and the public will expect we do and has every right to expect that.

The Fed still maintains that there is no rush for developing a CBDC. However, Powell confirmed that they "going to look at it very, very carefully." On the other hand, the regulator is "determined to do this right rather than quickly, and it will take some time — measured in years rather than months."

Ripple pushes XRP Ledger for CBDC's and stablecoins' support'

Ripple, a San Francisco-based Blockchain Company, is ready to dive into CBDC's race using its XRP Ledger (XRPL). According to Ripple, banks can issue stablecoins on XRPL due to its "unique, fungible token functionality called Issued Currencies." Ripple added that:

Issued Currencies is designed to be the ideal stablecoin platform, providing simple but rich management functionality for the issuer that makes it easy to create, issue, and manage any asset – including stablecoins.

Meanwhile, XRP is trading at $0.29, with the upside capped under $0.3 for several days. Attempts to break above this critical level have been unsuccessful. For now, the path with the least resistance appears to be downwards.

XRP/USD 4-hour chart

XRP/USD 4-hour chart

XRP will have to break out of this consolidation for any significant price action to occur. Gains above the 50 Simple Moving Average and $0.3 would pave the way for XRP to rise to the 200 SMA and perhaps test $0.4.

On the other hand, a daily close below $0.9 will see XRP/USD extend the bearish leg to the 100 SMA. If selling pressure intensifies, the price may drop to $0.25 (early this week's support) before a reversal occurs.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Dogecoin Price Forecast: Bulls deploy $355M in DOGE longs amid Gensler exit confirmation

Dogecoin Price Forecast: Bulls deploy $355M in DOGE longs amid Gensler exit confirmation

Dogecoin price crossed $0.40 on Friday, after a weeklong consolidation that saw DOGE tumble 13% from last week’s peak. Derivative market reports link the DOGE rally to Gary Gensler’s  imminent exit.

More Cryptocurrencies News
Crypto Today: XRP gains 10%, Cardano, XRP, and DOGE price rallies, delay Bitcoin’s $100K breakout

Crypto Today: XRP gains 10%, Cardano, XRP, and DOGE price rallies, delay Bitcoin’s $100K breakout

The global cryptocurrency sector pulled $230 million capital inflows on Friday, as markets reacted positively to news of SEC Chair Gary Gensler’s imminent exit.

More Crypto News
Cardano Price Forecast: ADA could rally by another 30% as on-chain data signals bullish sentiment

Cardano Price Forecast: ADA could rally by another 30% as on-chain data signals bullish sentiment

Cardano (ADA) surged 24% to $0.98 on Friday following rising weekly active addresses, increased open interest and spot buying pressure.

More Cardano news
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.

More Shiba Inu News
Bitcoin: Rally expected to continue as BTC nears $100K

Bitcoin: Rally expected to continue as BTC nears $100K

Bitcoin (BTC) reached a new all-time high of $99,419, just inches away from the $100K milestone and has rallied over 9% so far this week. This bullish momentum was supported by the rising Bitcoin spot Exchange Traded Funds (ETF), which accounted for over $2.8 billion inflow until Thursday. BlackRock and Grayscale’s recent launch of the Bitcoin ETF options also fueled the rally this week. 

Read full analysis
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

BTC

ETH

XRP