Cryptocurrencies mainly used for illegal financing – Yellen

Janet Yellen, Treasury Secretary in waiting, left no doubt as to her views on Cryptocurrencies. She claimed that they were being mainly used for illicit financing and money laundering. 

Janet Yellen is odds-on favourite to become the new Treasury Secretary for the Biden administration. She said that she would be keeping a close eye on Cryptocurrencies given that they are a “particular concern” as regards their role in criminal and terrorist activities. 

“we need to make sure that our methods for dealing with these matters, with terrorist financing, change along with changing technology,"  

Yellen has certainly not changed her stance on Cryptocurrency and over the years she has had plenty to say about Bitcoin.  

“very few transactions are actually handled by bitcoin, and many of those [that] do take place on bitcoin are illegal, illicit transactions.” 

“It is not a stable store of value and it doesn’t constitute legal tender. It is a highly speculative asset.” 

Her anti cryptocurrency statements appear to fall in line with similar comments made by others from the traditional financial system. Only recently Christine Lagarde, ECB President, said that Bitcoin was a 

"highly speculative asset which has conducted some funny business and some interesting and totally reprehensible money laundering activity," 

Warren Buffet, CEO of Berkshire Hathaway, is well known for his anti-Bitcoin sentiment, claiming that it was “rat poison squared” and "It draws in a lot of charlatans.” 

The Blockchain data company Chainalysis recently reported that criminal activity in the Cryptocurrency space had fallen to just 0.34%, around 10 billion in transaction volume, and that this had fallen from 2.1% the previous year. 

It would appear therefore that overall, crime-related activities that involve Cryptocurrencies are falling steadily. 

Blockchain is the foundational feature of Cryptocurrencies. Transactions that take place on it are fully transparent (except for the use of some privacy coins) and therefore leave a trail that Government can inspect.  

With more regulation and oversight, could the Blockchain/Cryptocurrency space become even safer than the present financial system? 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.