Following President Trump’s derisive tweet about Bitcoin, U.S. Secretary of the Treasury Steven Mnuchin held a briefing on regulating Bitcoin and Facebook’s Libra because of their use in criminal activity and the threat they pose to the financial system.
An hour ago the U.S. Department of Treasury held a briefing to express its stance on cryptocurrency. The briefing was focused on the “misuse” of crypto stemming from its ability to circumvent regulations due to its pseudo-anonymity and decentralization. These qualities may jeopardize the U.S. financial system, Mnuchin suggested.
The Treasury on Bitcoin
Mnuchin first emphasized that Bitcoin and other cryptocurrencies are often used by criminals looking to circumvent U.S. controls:
“I will focus primarily on the serious concerns the Treasury has of the growing misuse of cryptocurrency by money launderers, terrorist financiers, and other bad players.”
“Cryptocurrency such as Bitcoin have been exploited to support billions of dollars of illicit activity like cybercrime, tax evasion, extortion, ransomware, illicit drugs, human trafficking. Many players have used cryptocurrency to support their maligned behavior—this is indeed a national security issue.”
This association is not surprising. Silk Road was partially responsible for accelerating the adoption of Bitcoin while it was still gaining critical mass, while its application in illegal activity is one of the cryptocurrency’s major use-cases.
“If you think you’re going to use Bitcoin to go on the dark web… you’re gonna get caught,” Mnuchin asserted.
As such, it’s not surprising that the focus of the Treasury is on criminal uses and how businesses which transact or deal in cryptocurrency must comply with the proper regulations.