Fed Official Advocates for Minimal Crypto Holdings Among Central Bank Staff

Federal Reserve Vice Chair for Supervision Michelle Bowman has proposed allowing central bank employees to hold small amounts of cryptocurrency. Speaking at a blockchain conference in Wyoming, Bowman argued that firsthand exposure to digital assets WOULD enhance regulators' understanding of the technology.

"Our approach should consider allowing Fed staff to hold de minimis amounts of crypto or other types of digital assets," Bowman stated. The Federal Reserve currently prohibits officials from holding or trading cryptocurrencies, a policy extended to crypto investments by the Federal Open Market Committee in 2022.

Bowman compared crypto education to learning to ski, noting that theoretical knowledge alone is insufficient. "There's no replacement for experimenting and understanding how that ownership and transfer process flows," she said. The MOVE could also help the Fed attract and retain tech-savvy talent in a competitive market.

The Fed executive urged regulators to embrace blockchain technology, warning that failure to do so risks allowing the sector to develop outside traditional banking systems.