The United States Department of the Treasury convened a meeting with influential figures in the blockchain space to discuss the industry’s challenges. The working session centered on the supervisory and regulatory challenges surrounding digital assets such as cryptocurrencies.
Treasury to work on crypto regulation
The US Treasury made the announcement on Mar. 2 that it had invited cryptocurrency industry thought leaders and compliance experts for discussions about its oversight role on crypto assets. Steven Mnuchin, Secretary to the Treasury, stated that the American government is open to innovation that could potentially improve the nation’s financial system. But, he cautioned that the government would not embrace such innovations at the expense of national security. Mnuchin highlighted the need for new inventions to adhere to the established regulatory and compliance requirements saying
The U.S. welcomes responsible innovation, including new technologies that may improve the efficiency of the financial system. We must ensure that we balance innovation with the need to protect our national security and maintain the integrity of our financial system.
The announcement also affirmed the Treasury’s focus on averting the misuse of digital currencies in illicit activities such as money laundering and funding terrorism. The Treasury also reiterated its commitment in regulating cryptocurrency providers insisting that it will be steadfast in performing its oversight role. The department stated that it remains at the forefront of battling illicit financial undertakings and that it will not tolerate the use of cryptocurrencies in such activities.
Treasury past issues with cryptocurrencies
In the past, the US government and financial regulators have exercised caution, and even strong opposition at times in regards to cryptocurrencies. Just last year, the Treasury secretary himself stated that Bitcoin accounted for more money laundering activities than cash.
Lael Brainard, a member of the US Federal Reserve board of governors, also made similar statements last December. According to Brainard, a quarter of Bitcoin users are criminals and half of all Bitcoin transactions are for illicit activities.
Such comments suggest there is strong belief by regulators that cryptocurrencies are better suited for illegal activities. In the backdrop of this understanding, the recent meeting between the Treasury and top crypto experts may serve as a positive development for the virtual asset. Cryptocurrency investors and the general blockchain community can only hope that the meeting was convincing enough to the regulators that digital assets can be used for good. They will also be hoping that the banking industry will follow suit and open the doors for crypto-related businesses.
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