Federal Reserve Chair Jerome Powell likened Bitcoin to digital gold during his speech at the Jackson Hole Economic Policy Symposium on August 2025, drawing significant market attention. His remarks emphasized Bitcoin’s role as a speculative asset rather than a direct competitor to the U.S. dollar, reinforcing its positioning alongside gold as a store of value. “People use Bitcoin as a speculative asset, right? It’s like gold. It’s just like gold, only it’s virtual, it’s digital. It’s not a competitor to the dollar,” Powell stated [1]. This analogy resonated across the financial sector, triggering a surge in institutional interest and investment flows into Bitcoin.

In the wake of Powell’s comments, U.S.-listed Bitcoin exchange-traded funds (ETFs) recorded record inflows, signaling a shift in capital allocation strategies by institutional investors. The movement mirrored the traditional safe-haven dynamics seen in gold, highlighting Bitcoin’s evolving role in diversified portfolios amid global economic uncertainties. The increased institutional adoption is also evident in the reallocation of liquidity from traditional equities to cryptocurrencies, reflecting a broader acceptance of digital assets as a class of investment.

Bitcoin’s performance further demonstrated its unique position in the market. Despite declines in major stock indices, Bitcoin’s price remained resilient, showing a decoupling from traditional equity markets. During trading hours, American institutional investors actively moved funds into Bitcoin, underscoring confidence in its long-term stability. This behavior aligns with Powell’s characterization of Bitcoin as a speculative and safe-haven asset, contributing to its growing legitimacy in mainstream finance.

The Federal Reserve’s acknowledgment may also influence future regulatory and investment developments within the financial system. While no immediate policy shifts were announced, the statement is expected to encourage further discussions around potential federal oversight of cryptocurrency markets. As digital finance continues to evolve, the broader financial ecosystem may witness structural adaptations shaped by the increasing integration of digital assets like Bitcoin.

Source: [1] Powells Likens Bitcoin to Digital Gold, Sparks Market Activity (https://coinmarketcap.com/community/articles/68ab13adf6f9732ed734b831/)