The price of original cryptocurrency Bitcoin fell more than 10% on Thursday after Federal Reserve chairman Jerome Powell called for an immediate halt to the launch of Facebook Inc’s (NASDAQ:FB) Libra cryptocurrency.
Speaking to the Financial Services Committee of the US’s House of Representatives on Wednesday, Powell said that Libra, which alongside Facebook also counts payments giant Visa Inc (NYSE:V) and taxi app Uber Technologies Inc (NYSE:UBER) among its backers, raised “serious concerns” around privacy, consumer protection and money laundering as well as more general financial stability.
READ: Facebook unveils new Libra cryptocurrency
Until these concerns were addressed, Powell said he did not think the project should proceed.
The comments sent a bit of a chill through the crypto trading desks, with Bitcoin having dropped 11.9% to US$11,470 at lunchtime.
Craig Erlam, senior market analyst at OANDA, said that while the comments were “good news” as the Fed taking a “serious, thorough and long-term approach” to the crypto space was ultimately a positive, it wasn’t what traders had wanted to hear, especially after a “good run” of price gains.
