[Bitcoin Now] Fed Governor Waller Says "Post-Trump Crypto Euphoria Is Fading"

Waller: "Companies That Accessed Crypto Through Mainstream Finance Unwound Risky Positions"

Fed Governor Christopher Waller

Christopher Waller, a member of the U.S. Federal Reserve Board, commented on the recent sharp swings in Bitcoin prices on the 9th (local time), saying it was "part of the euphoria that swept through the cryptocurrency world with the inauguration of the current (Donald Trump) administration now fading."

Governor Waller said at a conference held in La Jolla, California, that the recent increase in Bitcoin volatility may have been driven by regulatory uncertainty and risk-management measures by large financial institutions.

Governor Waller said, "I think the reason there has been so much selling (in the recent cryptocurrency market) is that firms which accessed the cryptocurrency market through mainstream financial markets had to unwind their risk positions and sell off assets."

After the Trump administration, which advocated crypto-friendly policies, took office last year, optimism about the cryptocurrency market grew, and a massive influx of capital entered the crypto space through traditional financial markets, including Bitcoin exchange-traded funds (ETFs).

However, as such optimism has recently weakened, it is being interpreted as an indication that companies may have sold off large amounts of cryptocurrency assets in order to avoid risk exposure that could show up on their financial statements.

On the 5th, the price of Bitcoin fell to the low-60,000-dollar range per coin, effectively giving back almost all of its gains since President Trump was elected.

Cryptocurrencies had long been dubbed "digital gold" and had attracted expectations as a hedge against inflation, but in the recent period of heightened volatility, they have failed to serve as a safe-haven asset unlike physical gold. Instead, they have shown vulnerability in times of stress, which has, according to assessments, deepened investor disappointment.