The post Does the Federal Reserve Have The Power To Block The Bitcoin Reserve Plan? appeared on BitcoinEthereumNews.com.
Recently, Fed Chair Jerome Powell made it clear that the Fed has no intentions of taking part in any government plan to accumulate Bitcoin. He underscored that such matters come under the jurisdiction of Congress and the Fed does not wish to seek a change in existing laws to allow for Bitcoin holdings. Powell’s statement instantly shook the market, which caused Bitcoin’s price to quickly pull back from its high earlier in the week. Besides, the probability of a Bitcoin Strategic Reserve dropped from a peak of 40% on the 18th to 34% after Powell’s speech on the Polymarket platform. WuBlockchain in the latest post has shared insights on whether the Fed could prevent the US from creating a national Bitcoin reserve. Can the Fed Block the BSR plan? The U.S. Congress is the highest authority in the financial system, responsible for enacting regulations and authorizing agencies like the SEC and Federal Reserve to perform their functions. It is important to note that while the Fed enjoys a high degree of independence in monetary policy and national economic stability, it does not have a “veto power” over the decision to establish a BSR. Can Trump Quickly Establish BSR? In order to quickly establish a strategic bitcoin reserve, the Trump administration could issue an executive order requiring the U.S. Treasury to use the Exchange Stabilization Fund (ESF) and directly purchase Bitcoin. Notably, the operation of the fund is not controlled by Congress, and the President and Treasury have significant independence in its use. This approach would avoid the need for congressional approval, and reduce political opposition. However, the sustainability of such a BSR is uncertain, as future administrations could revoke or amend the executive order. A Long-term BSR To establish a long-term and stable BSR, a more legal and stable route…