Bitcoin, Ether rise after a volatile week as Fed assesses crypto risk
Bitcoin traded higher on Sunday after a volatile week, increasing by 0.4 percent to $33,956 at 6:20 p.m. Riyadh time. Ether was up by 1.47 percent to trade at $2,140, reversing a decline from Friday, according to data from Coindesk.
Below is the main news on cryptocurrency over the week:
The US Federal Reserve on Friday singled out for the first time a dramatic rise in the price of cryptocurrencies in its overall assessment of the financial system’s stability, according to Bloomberg. The Fed is more concerned about cryptos than ever, with chairman Jerome Powell meeting the head of cryptocurrency exchange Coinbase Global Inc. on May 11 and crypto advocate Christopher Giancarlo a day later, according to the central
banker’s monthly diary.
The bank, in its Monetary Policy Report, told Congress that “the surge in the prices of a variety of crypto-assets” reflected investors’
increased risk appetite. While Fed officials have discussed crypto before, the institution itself has seldom, if ever, used the asset class as a benchmark to consider broader market conditions.
Tether is the third-biggest cryptocurrency in the world by market value and it has some economists — including a Fed official — worried. Some investors and economists are worried that Tether’s issuer does not have enough dollar reserves to justify its dollar peg. With more than $60 billion worth of tokens in circulation, Tether has more deposits than that of many US banks, according to Coindesk.
The Bank of Thailand issued a warning notice, titled “Caution on Using Digital Assets as Means of Payment for Goods and Services” on Thursday, according to Bitcoin News. The bank said a growing number of companies were asking for payments in cryptocurrencies, but reiterated its stance on crypto and warned of the risks of using it as a means of payment.