July 18 (UPI) -- The chairman of the Federal Reserve referred to cryptocurrencies as risks with no intrinsic value on Wednesday at a congressional hearing.
In testimony to the House Financial Services Committee, Jerome H. Powell said currencies untethered to governments or precious metal, such as bitcoin, pose serious risks to investors.
"Relatively unsophisticated investors see the asset go up in price, and they think, 'This is great; I'll buy this.' In fact, there is no promise of that," Powell said. "There are investor and consumer protection issues as well."
He added that the Federal Reserve regards cryptocurrencies as a consumer protection issue, and will not develop cryptocurrency of its own, contrary to rumors.
Powell also restated the Fed's intent to gradually raise interest rates. His two days of testimony, including Tuesday before the Senate Banking Committee, revealed concerns among lawmakers over President Donald Trump's trade policies. Powell expressed similar concerns. Trump recently announced tariffs on products entering the United States and the European Union, and was met with reciprocal tariffs on imported U.S. goods.
"A more protectionist economy is an economy that's less competitive, less productive," he said. "We know that. It's not a good thing, if that's where this goes."