Opinion: Yesterday, Treasury Secretary Mnuchin testified that ‘We are about to roll out some significant new requirements,’ in response to a question on cryptocurrency. ‘We want to make sure that technology moves forward; on the other hand, we want to make sure cryptocurrencies aren’t used for the equivalent of old Swiss secret number banking.’
In 2019, the introduction of Facebook’s Libra Project, a cryptocurrency designed under the leadership of David Marcus, former CEO of PayPal, with the intention of providing the millions of unbanked populations around the world, sent shock waves to the leaders of nation states including the United States and China on the future of monetary policy and the balance of power in the 21st century.
The looming threat of cryptocurrency tokens run on blockchain networks with no influence or power that can be exerted by nation states - whether from bitcoin, the first cryptocurrency that operates off of a global decentralized network on computers, or from Facebook’s creation of a conglomerate of private corporations that stand to become a global digital central bank using blockchain technology to issue tokens that could become a new form of money as ubiquitous as the world wide web.
White House Policies do not typically happen in a vacuum. The Treasury has already warned cryptocurrency companies through the FinCen Director Kenneth A Blanco about needing to comply with Bank Secrecy Act rules. ‘Please remember what is at stake here.’ is how Director Blanco ended his speech at an event in November 2019 where he was discussing the importance of regulating cryptocurrencies to avoid its use by terrorist organizations or money launderers. He was following up on what The Financial Action Task Force (FATF), an international organization responsible for money laundering and antiterrorism policies, had already issued in terms of a regulation that is commonly known as the ‘Travel Rule’. This ‘Travel Rule’ makes it that when you are buying and selling bitcoin on a blockchain, the information of the sender and the receiver must be recorded on both ends of the transaction - something that ostensibly the Bitcoin blockchain network was never designed to consider.
No comments:
Post a Comment