The Bitcoin price dipped below $100,000 yesterday after the chairman of the U.S. central bank spoke out about the digital currency. After Jerome Powell, the chairman in question, explained the 25 basis point interest rate cut, it was time for the press conference.

Does the U.S. central bank see value in Bitcoin?

Powell was asked if he sees any value in building a Bitcoin reserve with the U.S. central bank. He cleverly dodged that question, stating that current laws and regulations make it impossible for the central bank to purchase Bitcoin.

“We are not allowed to own Bitcoin. The Federal Reserve Act says we are not allowed to own it, and we are not looking to change that law,” Jerome Powell said.

All over the news, we now see it reported that the U.S. central bank is not going to put Bitcoin on its balance sheet. That, of course, is not the correct conclusion.

Powell is simply saying here that it is not possible based on current law, and he is right about that. But that has always been the case.

Of course, it’s all about the promise of Donald Trump, who indicated in July 2024 that he wants to build a strategic Bitcoin reserve for the U.S. As such, this statement by Powell has no meaning or value.

So why did the Bitcoin price fall?

In other media we saw reports that the Bitcoin price dropped because of these statements by Powell, but of course that is the biggest nonsense.

The Bitcoin price fell because of the policy expectations that the U.S. central bank shared. They indicated that they are now a bit more worried about inflation, and for that reason they are taking a more wait-and-see attitude when it comes to interest rate cuts.

Whereas before this they were still sitting on three interest rate cuts for 2025, that number has now been lowered to two. However, that does not necessarily mean that we will only get two, because the central bank’s expectations do not often come true.

And the latter is the case because the market and the economy react and change based on these statements.