The cryptocurrency market suffered a big hit on Wednesday, losing as much as 8.5% after the Federal Reserve chairman made negative comments about Facebook's digital currency Libra.
As of this writing early Thursday in Europe, Bitcoin was down around 5% at $11,536.
Fed Chairman Jeremy Powell said Facebook's cryptocurrency Libra "cannot go forward" unless the company takes serious measures to allay concerns.
"Libra raises many serious concerns regarding privacy, money laundering, consumer protection, and financial stability," Powell told the U.S. House of Representatives Financial Services Committee.
"I don't think the project can go forward" without addressing those concerns, he added, his words immediately taking a toll on Libra's value.
Powell also hinted the Fed is not a fan of bitcoin when he said the existing rules of financial markets do not fit digital currencies.
"It's something that doesn't fit neatly or easily within our regulatory scheme but it does have potentially systemic scale," he said.
"It needs a careful look, so I strongly believe we all need to be taking our time with this."
Recently, French Finance Minister Bruno Le Maire also shared his skepticism over Facebook's Libra.
Libra will allow Facebook "to assemble even more data, which only increases our determination to regulate the internet giants," Le Maire said, according to Bloomberg.
Maxine Waters, chair of the House Finance Committee, has asked House leadership to back her up in demanding that Facebook halts Libra's development until Congress examines the currency in detail.
The chairman of the Senate Banking Committee, Senator Mike Crapo, has scheduled a hearing for July 16 and Facebook has been invited to testify at a panel the next day.
Facebook last month announced the new digital currency, which aims to provide financial services that will let people make payments via Facebook apps and the WhatsApp messaging service.
