Crypto Industry Faces Increased Pressure For Regulatory Compliance From US Treasury

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The United States’ treasury, through the Secretary of the Treasury Steve Mnuchin, made an announcement regarding the state of cryptocurrency in the country. The Secretary’s comments regarding the digital financial technology were far from positive and they left stakeholders in the crypto industry with more questions than answers.

Prior to the announcement made by Secretary Mnuchin, President Donald Trump had tweeted about cryptocurrencies such as Libra and Bitcoin, expressing his “distaste” towards digital assets and making comments about their unlawful use.

Is The United States Considering Regulating The Crypto Industry?

Cryptocurrencies are a new technology and although they have the potential to change the face of financial assets, there is a lot about the digital assets that is unknown. There are a lot of opinions about cryptocurrencies and these have fueled differing stances among the general public and policymakers.

Bitcoin and the rest of the cryptocurrencies in existence have gained a bad reputation due to their use in financial crimes and unlawful activity. Some of these illegal activities include tax evasion, ransomware, illicit drugs, human trafficking and cybercrimes as explained by Secretary Mnuchin.

The Secretary also spoke about the growing popularity of digital assets and he made reference to Facebook’s Libra and Bitcoin. He made it clear that the government would take a hard stance against the use of cryptocurrency in illicit activity. He added that the government would be cracking down on exchanges that offer digital assets but do not comply with regulations.

Pseudo-anonymity which comes with the use of cryptocurrency makes them easy to use in criminal activity. However, it is important to note that just like any other technology, it comes down to people who use cryptocurrency incorrectly. No matter what the technology is, there will always be some people who use it illegally as is the case with the internet and even fiat currency.

How Cryptocurrency Holders In The United States Are Likely To Be Affected

The statement made by the Treasury Department comes just a few weeks after Binance announced that they will no longer be offering their services to customers in the United States. With the United States government making its position on cryptocurrency clear and unfavorably so in the view of crypto stakeholders, there is speculation in the industry that this might be the start of United States investors being cut off from crypto markets.

With the heavy regulation that is consistent with financial markets in the United States, the crypto industry will certainly be transformed in the future. It is only yet to be seen whether the industry will be completely suffocated in the country or whether regulations will be made to slow the industry to grow and prosper in the United States.

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About Ali Raza

A journalist, with experience in web journalism and marketing. Ali holds a master's degree in finance and enjoys writing about cryptocurrencies and fintech. Ali’s work has been published on a number of cryptocurrency publications.