US Treasury Secretary Steven Mnuchin agrees with his boss (Trump) that cryptocurrencies are prepared for scammers.
At a press conference on Monday, Mnuchin expressed concerns about the Trump administration's cryptocurrencies such as Facebook's Libra and Bitcoin. After Mnuchin issued the above statement, the US Congress will hold two hearings this week. It is expected that David Marcus, the head of the Facebook blockchain, will testify before members of the House and Senate.
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Before the press conference, US President Trump released a series of tweets about cryptocurrency and Facebook cryptocurrency Libra last week. At the time, Trump said that cryptocurrencies were used for "illegal" activities such as drug smuggling. In a subsequent tweet, Trump said that Facebook may have to obtain a banking license to use Libra to conduct business.
Although Mnuchin did not issue any new policy statements on Monday, he reiterated the statements made by several government entities in the past. One of the main problems is that cryptocurrencies may be used by criminals.
“Libra may be abused by money launderers and terrorist financiers.”
He cited money laundering, terrorist financing, extortion, human trafficking, drug trafficking and tax evasion as examples of cryptocurrencies and Libra that could fuel crime. He added:
"This is indeed a national security issue."
The Financial Crimes Enforcement Network (FinCEN) will investigate Libra and Bitcoin and will adopt the “highest standard” for any entity engaged in these two transactions, Mnuchin said.
Mnuchin also mentioned the Financial Action Task Force (FATF), which last month issued guidelines for member governments on how to regulate cryptocurrency service providers. The FATF's guidelines specifically recommend the implementation of so-called “travel rules” that require exchanges and wallet providers to retain information about their customers (KYC) on both sides of each transaction.
After the speech, Peter Van Valkenburgh, director of the Coin Center Research Center, emphasized that the US Treasury Department, led by Mnuchin, has provided guidance to cryptocurrency custodians on how to comply with the Bank Secrecy Act and how to attempt to “export” their policies through the FATF.
“We will do our utmost to ensure that effective regulation is not limited to our borders.”
Look at Libra again
At a half-hour press conference, Mnuchin mentioned Libra many times. He said that the representative of Facebook's social media giant has met with Treasury officials and other government agencies.
As long as Facebook can maintain strict anti-money laundering standards, Libra should have no problem on the line, but Mnuchin has repeatedly said that the company still has a lot of work to do before it is sure that it is in compliance.
Mnuchin said he felt "uncomfortable" about the launch of Libra at this time.
“About Facebook's Libra, our primary goal is to maintain the integrity of our financial system and protect it from abuse.”
In response to questions about Bitcoin and other broader cryptocurrencies, Mnuchin stated that he did not know and would not guess how or why Bitcoin prices might reach current levels.
“We will ensure that the public and investors understand what they are investing in and whether they have appropriate disclosures, whether it is the SEC or other regulatory agencies.”
The response of the cryptocurrency community
The cryptocurrency community quickly responded to the latest comments from the US Treasury Secretary about Libra and Bitcoin.
Encryption analyst Joseph Young said on Twitter:
"It seems that the US government will step up regulation of cryptocurrencies. US Treasury Secretary Steve Mnuchin said that the 'Financial Stability Oversight Committee's Digital Assets Working Group' will enable all regulators, such as FinCEN, SEC, CFTC and other institutions, to fight The risk of cryptocurrency."
EricHub founder Eric Conner commented:
“Munchin’s pressure is good and overall is bullish. I think Facebook paves the way for regulation. The US has not shown any signs of banned encryption, they just want encryption to follow existing laws. At the same time, encryption technology It has become the focus of national attention."
Bitcoin analyst Rhythm just replied:
“Why is the president and the finance minister opposed to Bitcoin? Accountability. The bank helps to wash money more than $2 trillion a year. This is 10 times higher than the value of the entire Bitcoin network. Why do they criticize Bitcoin so much? Because the public account will be Their most terrible nightmare."
Cryptographic currency analyst Alex Krüger sent a comment saying:
"US Treasury Secretary Steve Mnuchin has warned those who do not comply with the US anti-money laundering law. Not to mention the ban. Specifically, bitcoin speculation is ok. From the last weekend's sell-off, it seems that the main participants know in advance. The press conference was held and sold. I saw the shorts to cover it."
Morgan Creek founder Anthony Pompliano sent a comment saying:
"US Treasury Secretary Steve Mnuchin is basically telling everyone to follow the rules and not to do illegal things with bitcoin or cryptocurrencies. For those who want to do things compliant, this sounds like a good news. The government likes bitcoin, as long as you don't break the law."