The former chair of the US Federal Reserve has said that she was “not a fan” of Bitcoin. As secretary of the US Treasury Department, she will be able to tighten the regulations on Bitcoin.
After Joe Biden appointed Janet Yellen as the US Treasury Department, everyone is expecting to see what she has in store for Bitcoin. The former Chairperson of the US Federal Reserve does not hold cryptocurrencies in high regard.
The female front in the Democratic president’s cabinet grows with Janet Yellen’s appointment. However, the Senate, which could be a Republican majority, still has to ratify it to make it completely official.
When Yellen was the head of the US Federal Reserve in 2018, she expressed opinions against Bitcoin. She said that Bitcoin, which is about to reach its all-time high, is a “highly speculative” asset.
She has worked intermittently in the US Federal Reserve since the 1990s. However, she has noted that this organization does not play any regulatory role in the operation of Bitcoin.
In October 2018, Yellen said that she was “not a fan” of Bitcoin. She argued that Bitcoin handles “very few transactions and many of those that take place on Bitcoin are illegal and illicit transactions.” She expressed concern “about the implications of the use of cryptocurrencies for terrorist financing, money laundering,” and other similar activities.
Yellen not only emphasized the potentially illegal provenance of certain bitcoins. She also mentioned factors such as value stability and its decentralized nature.
She said that “a useful source of money needs to be a stable source of value, but Bitcoin is anything but that.” She added that “it is not an efficient means to process payments due to its very decentralized nature and it has difficulties in achieving trust for the inequality of transactions.”
As the new head of the US Treasury Department for the 2020-2024 periods, Janet Yellen would create policies on fiscal matters and federal fund management. Also, Janet Yellen would influence the policy of public debt and financial assets, among others. Given that this office essentially controls money from a government perspective, she could influence regulation or tax burdens on Bitcoin.
The appointed Secretary of the US Treasury Department would have control over the Financial Crimes Enforcement Network (FinCEN), the Office of Foreign Assets Control (OFAC), the Internal Revenue Service (IRS), and the Office of the Comptroller of the Currency (OCC).
Steve Mnuchin was the former secretary of this office. According to John Bolton’s book “The room where it happened”, President Trump ordered Mnuchin to “go after Bitcoin (for fraud).”
The responsibility for regulating or not the activities involving Bitcoin will now be in Janet Yellen’s hands. She will decide whether or not to follow in her predecessor’s footsteps, as the Treasury Department has done before, by blacklisting Bitcoin addresses.
Even though she has expressed opinions against Bitcoin, she admitted in 2019 that “(blockchain) is a quite important technology that can have implications in the way that people handle transactions within the financial system.” No one knows yet what the new US Treasury Department Secretary’s policy will during Biden’s administration.
By Alexander Salazar
