Janet Yellen says US does not have framework to regulate cryptocurrencies

Janet Yellen

US Treasury Secretary Janet Yellen is of the opinion that the country does not have an adequate framework to deal with all the different issues posed by cryptocurrencies like money laundering and illicit financing.

She says that there is no framework that is quite up to the task of putting in place a regulatory framework that we need for this new breed of digital currencies.

And she may be right!

Yellen was talking about cryptocurrency regulation at The Wall Street Journal CEO Council Summit on Tuesday, where she was asked whether she anticipated regulation on cryptocurrencies. Her replay to the question was:

“I think cryptocurrencies, we don’t really have an adequate framework to deal with the different issues that they pose from a regulatory perspective.”

The treasury secretary proceeded to name several issues associated with cryptocurrencies, and these included money laundering, Bank Secrecy Act, use of digital currencies for illicit payments, as well as consumer protection.

Yellen pointed out that there are several agencies that arguably have some ability to address this through regulation. But she sees concerns:

“I frankly don’t think we have a framework in the United States that is quite up to the task of putting in place a regulatory framework that we need in the future.”

This is a topic that is well worth addressing, she added.

And when asked her thoughts on the digital dollar, Janet Yellen replied that she knows that the Federal Reserve is looking at a central bank digital currency. Yet, there remain a lot of issues in connection with it, like the different ways that it could be rolled out and potential financial stability issues associated.

There could be an argument for a central bank digital currency, but she cautioned that it is something that we need to study carefully and be careful about.

Sage advice.


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