Biden Administration Working on Increasing Oversight on Cryptocurrency to Protect Investors
The Biden Team is currently working on increasing oversight on cryptocurrency to make sure that investors are protected and illicit transactions cannot take place. Lawmakers, White House representatives, and central bankers have recently had several meetings for the regulation of cryptocurrency after the recent swings that crypto prices took.
White House officials have been briefed by experts working in the Treasury Department about potential risks that cryptocurrencies can post. The Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency (OCC) have both been involved in the process too. The Biden Administration officials are currently studying the potential gaps that could exist in terms of oversight. Since cryptocurrency is increasingly being used for terrorism activities and finance illicit, there should be some regulation to protect investors.
Some potential protectors are also discussed for average retail investors who are putting their money into cryptocurrency. The Treasury Department has also unveiled the tax proposal by Biden that makes it a requirement for companies to report cryptocurrency transactions of over $10,000. The Internal Revenue Service (IRS) is part of the larger effort to reduce tax evasion.
As of now, federal regulators don’t consider the volatile nature of cryptocurrency as a full threat to the bigger financial market’s stability. However, they do think that the risks should be monitored. Officials from the White House have had discussions about increasing oversight while allowing people to invest as much as they like.
One official stated, “They’re aware of the fact that there are all kinds of risks in the abstract and things to look out for, but they are still largely in a wait-and-see posture.”
Congressional lawmakers and central banking officials have stated how there are some policies that can change the cryptocurrency market in a significant manner. The Senate has received bipartisan legislation from the House that instructs the federal regulators to properly clarify and study the rules of the cryptocurrency. The Supervision Randal Quarles’s Federal Reserve Vice Chair considers the matter one of great priority.
The recent instability of the market has resulted in some concerns around cryptocurrency. One major concern is the environmental impact that Bitcoin and the mining of other coins has. Government officials have also stated that this kind of currency makes it quite easy for criminals and terrorists to transfer money without getting detected. Recently, in a cyber-attack on a fuel pipeline, the perpetrators were paid $5 million through untraceable cryptocurrency.
One economist who worked with the Obama Administration, Jason Furman, had commented, “I wish we had smothered this a decade ago before it grew into a $2 trillion monster. Digital currencies are all cons and no pros — environment, crime, volatility, taking advantage of unaware investors. If they had any use at all, we could debate it. But they don’t have any use at all.”
However, a lot of people don’t share the same sentiment seeing a lot of value in Bitcoin and other cryptocurrencies for their fast processing and free transaction abilities. This is why the government should expect cryptocurrency to stick around.
The U.S. Securities and Exchange Commission’s new chairman has also stressed on the importance of investor protection and regulation on crypto exchanges. He has also been in touch with Congress about the problem. However, Jim Himes, a Congressman, has stated that Congress is not fully ready to act on cryptocurrency yet, so registration for crypto may not pass through Congress any time soon. The Biden Administration will be taking a close look into problems like tax evasion, investor protection, and money laundering, which is ultimately good for investors and will serve to add a level of security and transparency to cryptocurrencyusking platform like qunatum ai