US Treasury secretary-to-be wants to promote the „potential“ of cryptocurrencies
Janet Yellen sees cryptocurrencies as having „potential to optimise the financial system“.
Janet Yellen, the Treasury secretary-designate in Joe Biden’s new administration, is apparently more positive about cryptocurrencies than first suspected.
After a virtual hearing on Yellen’s planned inauguration was held in the US Senate Finance Committee on Tuesday, her response on dealing with „emerging financial technologies“ used to fund ´ criminal organisations and terrorists came into particular focus. In this context, Yellen described cryptocurrencies as „increasingly worrisome“, as they would be used in the US „primarily to finance illegal activities“ emanating from the aforementioned groups. Accordingly, the government would have to „crack down“ on cryptocurrencies as part of its anti-money laundering efforts.
However, her subsequent written testimony, posted today on the Finance Committee’s website, suggests that Yellen’s Crypto Engine stance on cryptocurrencies is probably not as negative as inferred from her remarks. Although she does reiterate the need to crack down on the use of cryptocurrencies for illegal activities, she adds that she wants to strengthen the use of digital currencies for „legal purposes“.
Thus, Yellen writes:
„I think it’s important that we also consider the potential benefits of cryptocurrencies and digital financial products, and their potential to optimise our financial system.“
With this, the finance minister-to-be wants the US to take „a leadership role in the areas of financial technologies and digital currencies“. Accordingly, she plans to work with the US Federal Reserve to develop a legislative framework for regulating cryptocurrencies „and other fintech innovations“ in order to create the necessary conditions
Yellen has already served as US central bank chief in Barack Obama’s administration
Her stance on cryptocurrencies was initially unknown, before she said in October 2018 that Bitcoin would be „anything but useful“. She had already left her post as head of the „Federal Reserve“ at the beginning of 2018, while Bitcoin (BTC) had climbed to the then record high of 20,000 US dollars only a few months earlier.
The Finance Committee will first vote on Yellen’s nomination in the coming days, after which the Senate will make a final decision on her appointment. Since the Democrats, to whom Yellen belongs, have the majority, she is probably assured of the necessary support. Should this happen, Janet Yellen would be the first female US Treasury Secretary.