There was no obvious catalyst for the move upward in the notoriously volatile digital currencies, which happened early Friday morning. Some traders pointed to Mr. Powell’s comments to the House Financial Services Committee on Thursday and to the start of the fourth quarter on Friday, when investors sometimes reset their portfolios.

Worries over regulation have kept a lid on cryptocurrency prices in recent months. Bitcoin slid last week after China’s central bank declared cryptocurrency-related transactions illegal, reinforcing the country’s tough stance against digital rivals to government-issued money.

During questioning before the House Financial Services Committee, Mr. Powell was asked whether he had any intention to ban or limit the use of cryptocurrencies, similar to China.

He said there was “no intention to ban them,” but added that stablecoins, which are cryptocurrencies whose value is tied to government-issued currencies such as the dollar, “are like money-market funds, they’re like bank deposits, but they’re to some extent outside the regulatory perimeter and it’s appropriate that they be regulated.”

While the comments didn’t indicate any obvious shift in policy, cryptotraders welcomed the posture from the Fed chairman.

“That was of course a very favorable note especially when you compare it to the People’s Bank of China,” said Naeem Aslam, chief market analyst at brokerage AvaTrade.

The surge in cryptocurrencies boosted shares of digital exchange

Coinbase Global Inc.,

which was up more than 3% in premarket trading.

Write to Caitlin Ostroff at caitlin.ostroff@wsj.com