Treasury Secretary Yellen says the regulatory frameworks for crypto belongings within the U.S. ought to “support responsible innovation while managing risks.” She emphasised, “Regulation should be based on risks and activities, not specific technologies.”
Treasury Secretary Yellen on Crypto Regulation
U.S. Treasury Secretary Janet Yellen talked about crypto regulation Thursday at American University’s Kogod School of Business Center for Innovation.
“Digital assets may be relatively new, but they are part of a larger trend – the digitization of finance – that has been in the making for decades,” she started.
Yellen talked about a variety of matters regarding bitcoin and different cryptocurrencies, together with how Bitcoin received began, Satoshi Nakamoto, the Bitcoin white paper, decentralized peer-to-peer programs, the double-spend drawback, bitcoin’s volatility, and crypto adoption. Moreover, she referenced President Joe Biden’s latest government order on the regulation of crypto belongings.
The treasury secretary proceeded to share some classes that “apply as we navigate the opportunities and challenges posed by these emerging technologies,” she described, including that one of many classes is “When regulation fails to keep pace with innovation, vulnerable people often suffer the greatest harm.”
She additionally mentioned stablecoins. “Of course, stablecoins are just one piece of a much larger ecosystem of digital assets,” Yellen mentioned, elaborating:
Our regulatory frameworks must be designed to assist accountable innovation whereas managing dangers — particularly those who might disrupt the monetary system and economic system.
“As banks and other traditional financial firms become more involved in digital asset markets, regulatory frameworks will need to appropriately reflect the risks of these new activities,” she detailed. “And, new types of intermediaries, such as digital asset exchanges and other digital native intermediaries, should be subject to appropriate forms of oversight.”
Furthermore, Yellen opined:
Regulation must be based mostly on dangers and actions, not particular applied sciences.
“When new technologies enable new activities, products, and services, financial regulations need to adjust,” she careworn. “But, that process should be guided by the risks associated with the services provided to households and businesses, not the underlying technology. Wherever possible, regulation should be ‘tech neutral.’”
In March, Yellen admitted that crypto has advantages, noting that the Treasury is engaged on crypto regulation. “Crypto has obviously grown by leaps and bounds and it’s now playing a significant role, not really so much in transactions, but in investment decisions of lots of Americans,” she mentioned.
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