Janet Yellen, the current US Treasury Secretary, has called for stricter regulation of the crypto market. In a recent speech to the American Senate Banking, Housing and Urban Affairs At the committee, Yellen emphasized the need to regulate the rise of digital currencies.
Yellen is calling on Congress to pass a law
Given the growing popularity of cryptocurrencies such as Bitcoin (BTC), Yellen has once again warned about the risks of this technology. It emphasizes the importance of preventing illegal activities such as money laundering and terrorist financing. These actions often involve anonymous transactions via crypto.
In the speech, Yellen cited an annual report from the Financial Stability Oversight Council (FSOC), an organization that works to ensure financial stability in the United States. And at the same time, the US Treasury Secretary is calling on Congress to close loopholes in the rules on digital assets. Yellen is also urging US lawmakers to pass legislation regulating cryptocurrencies and stablecoins.
“The committee focuses on digital assets and associated risks, such as runs on crypto platforms and stablecoins. But also potential vulnerabilities due to the volatility of crypto asset prices. “In addition, there is a sharp increase in platforms operating outside or failing to comply with applicable laws and regulations,” Yellen told the committee.
Yellen also discusses possible laws surrounding crypto. According to Yellen, Congress should roll up its sleeves as quickly as possible and create clear regulations once and for all:
“Congress should enact legislation to regulate stablecoins and the spot market for non-securities crypto assets.”
Take preventative measures against crypto criminals
Yellen is not the biggest fan of stablecoins. She believes the lack of disclosure of reserves makes them vulnerable to sudden panic selling. She is not alone. Senator Elizabeth Warren has also been known for her anti-crypto views for some time. The criminal sector, for example, would benefit enormously from the poorly regulated world of cryptocurrencies, Warren said. The discussion continues:
The fact that crypto is being used by terrorists is also a sensitive issue for Yellen and many other American lawmakers. According to Yellen, it is very important that legislation be updated to ensure that terrorist organizations can no longer send and receive payments in the form of cryptocurrencies.
