Fed's Waller: Crypto correction reflects risk adjustments by traditional finance

United States Federal Reserve Governor Christopher J. Waller downplayed the recent crypto market correction during a Global Interdependence Center conference in California last Monday. His statements arrived at a moment when Bitcoin (BTC) traded below $70,000 dollars, a level not recorded in 15 months.

Waller described the situation with a direct reading: "Part of the euphoria that came to the crypto world with the current administration is fading." The official linked the recent selloff to position adjustments by traditional financial institutions that entered the crypto sector during the post-election optimism period.

I think there were a lot of massive selloffs simply because companies that came in from conventional finance had to adjust their risk positions, sell, and many other things," the governor explained.

Bitcoin accumulates a correction exceeding 40% from its all-time high of $126,000 dollars reached in October 2025. Last week the price touched lows near $60,000, generating the largest volatility spike since the FTX collapse in 2022. The declines eroded part of the gains accumulated under expectations of greater institutional adoption and a more favorable regulatory environment under the Trump administration.

Waller compares the current correction with historical perspective

The governor rejected the drama surrounding price swings in the crypto market. According to reports, Waller described boom and bust cycles as something so common in the sector that they already carry their own name.

"The ups and downs in the crypto world have become so common that they even have a name: winters. It's part of the game," he stated.

The official reinforced his position with a direct historical comparison:

People say: 'Oh my God, Bitcoin has dropped to 63,000.' Eight years ago, if you had said it was at 10,000, they would have said: 'Oh my God, this is crazy.'

Waller ruled out that crypto volatility poses a concrete risk to the traditional financial system. He argued that both worlds operate with separate behavior:

These things are quite removed from the traditional financial world. Large drops and volume movements can occur. The rest of us wake up and the next day everything remains the same. Nothing bad happens. Banks are open. Your payments keep going through.

The governor indicated that the Federal Reserve plans to implement its "slim master account" proposal before the end of the year. The model offers simplified access to Fed accounts for certain financial entities. However, Waller acknowledged that developing a comprehensive regulatory framework for cryptocurrencies advances slowly, running parallel to the lack of approval of the Clarity Act in Congress.

The official closed his remarks with direct advice to investors: "Prices go up. Prices go down. If you don't like it, don't get in." The phrase summarizes the Fed's official position toward a market that swings between periods of euphoria and sharp corrections without affecting the core of the conventional financial system.