US Senate Confirms Janet Yellen as Treasury Secretary; What Does This Mean for Crypto?

US Senate Confirms Janet Yellen as Treasury Secretary; What Does This Mean for Crypto?

The U.S Senate has confirmed Janet Yellen on Monday as the Treasury Secretary in the newly inaugurated Biden administration with an overwhelming 84-15 vote. She takes over this position from Steven Mnuchin, who served in the Trump administration and left office last week following Biden’s inauguration.

Yellen’s era comes when crypto stakeholders are especially keen on the regulatory developments that might affect the industry. The previous Fed chairwoman had stated that she is ‘not a fan of Bitcoin,’ referring to it as a highly speculative asset.

Recently, she rubbed shoulders with the crypto community following her take that most crypto activity is attributed to illegal operations. During the Senate Financial Committee oral testimony, Yellen’s written testimony further elaborated her stance on the issue.

“I think many [cryptocurrencies] are used, at least in a transactions sense, mainly for illicit financing, and I think we really need to examine ways in which we can curtail their use.”

Nonetheless, she recognizes the underlying potential in cryptocurrencies and their supporting technology. Yellen suggested that a more prudent approach would be keeping up with the changing tech dynamics that malicious actors leverage to circumvent U.S authorities or interests.

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

Pending Crypto Regulations

With Yellen assuming the Treasury Secretary office, she can pick up on some active issues that Mnuchin left pending. These include crypto-focused regulatory proposals such as imposing stricter oversight for crypto wallets; it is currently frozen as part of President Biden’s recent decision to halt all pending agency rulemaking.

Other proposed FinCEN rules include reporting $10,000 or more for U.S citizens who hold an equivalent amount of crypto assets overseas. The financial regulatory body also wants to place a KYC threshold requirement of $250 for U.S cross-border crypto and fiat transactions; this is currently capped at $3,000. Finally, the OCC proposed a regulation that favors an extension of banking services to crypto, which was yet to be forwarded to the Federal Register before Trump’s exit.

Yellen has since vowed that she would collaborate with the mandated financial bodies to advance Fintech regulatory frameworks’ work. She particularly vowed to,

“work closely with the Federal Reserve Board and the other federal banking and securities regulators on how to implement an effective regulatory framework for these and other fintech innovations.”

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Author: Edwin Munyui

MicroStrategy Pumps its Bitcoin Stash to 70,470 BTC The Day Treasury Announces New Stimulus

MicroStrategy Pumps its Bitcoin Stash to 70,470 BTC, The Day Treasury Secretary Announces New Stimulus Checks Coming Next Week

The company buys another 29,646 BTC as it believes bitcoin will continue to provide “the opportunity for better returns and preserve the value of our capital over time compared to holding cash.”

Publicly-traded MicroStrategy has added another 29,646 BTC, as expected, in its balance sheet at an average price of $21,925 per BTC.

These Bitcoin have been bought from the proceeds of the $650 million senior convertible notes issued just this month. Michael J. Saylor, CEO of MicroStrategy, said,

“The acquisition of additional bitcoins announced today reaffirms our belief that bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value. We believe the proactive management of our balance sheet, combined with the improved revenue and profitability performance of the Company, have been significant factors in the recent appreciation in our stock price.”

Michael J. Saylor CEO of MicroStrategy

Now, as of December 21, 2020, the company holds an aggregate of 70,470 bitcoins, 0.37% of BTC’s circulating supply, acquired at an aggregate purchase price of approximately $1.125 billion through Coinbase.

With this, MicroStrategy now holds more BTC than the US Government, which has 69,420 BTC in its stash but less than the Chinese government’s 194,775 BTC holdings. Phong Le, President & CFO of MicroStrategy, said,

“The Company continues to believe bitcoin will provide the opportunity for better returns and preserve the value of our capital over time compared to holding cash. We also remain dedicated to our customers and our goal of operating a growing profitable business intelligence company.”

Phong Le President & CFO of MicroStrategy

Start that Money Printer

Interestingly, just today, Treasury Secretary Steven Mnuchin said that Americans who qualify for direct payments could get money in their bank accounts in a matter of days. Mnuchin told CNBC on Monday,

“The good news is this is a very, very fast way of getting money into the economy. Let me emphasize: People are going to see this money at the beginning of next week”

Steven Mnuchin Treasury Secretary

This came just hours after Congress approved the $900 billion Covid-19 relief bill in which individuals, including children, are receiving $600 in direct payments. Mnuchin expects this money to “take us through the recovery.”

“So it’s very fast, it’s money that gets recirculated in the economy,” he added.

“People go out and spend this money, and that helps small businesses and that helps getting more people back to work.”

Encouraging others to do the same

The announcement of MicroStrategy’s big bet on Bitcoin’s future also came on the day the digital asset fell under $22k from the high of $24,300.

Over the weekend, Saylor also encouraged Tesla CEO Elon Musk to make a similar decision to MicroStrategy and replace cash with bitcoin in their balance sheet.

“Do your shareholders a $100 billion favor,” said Saylor adding, “Other firms on the S&P 500 would follow your lead & in time, it would grow to become a $1 trillion favor.”

During the exchange with Musk, Saylor shared that he has purchased more than $1.3 billion in Bitcoin and offered to “share my playbook with you offline – from one rocket scientist to another.”

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Author: AnTy

Janet Yellen and the Fed Will Continue to Push Bitcoin to New Highs in the Next 5 Years

US Treasury Secretary Steven Mnuchin hasn’t been really good for cryptocurrencies. As we reported, the Treasury said in a statement on Monday, “There is strong support across the G7 on the need to regulate digital currencies.”

The G7 finance officials discussed the responses to the evolving landscape of cryptocurrencies to prevent their use for “malign purposes and illicit activities,” Treasury said.

Just last month, Coinbase CEO Brian Armstrong said that Mnuchin is planning to “rush out some new regulation regarding self-hosted crypto wallets before the end of his term,” although exchange’s former employer Brian Brooks, the acting Comptroller of the Currency, said there is no plan on killing cryptos.

However, Munchin hasn’t much time left in his term with Janet Yellen chosen as the new Treasury Secretary by President-elect Joe Biden.

Yellen’s views on crypto aren’t positive; she has called Bitcoin a “highly speculative asset” in the past and expressed concerns about its volatility when she should have shown more concern about the decreasing value of the US dollar.

However, Yellen won’t be bearish for Bitcoin price rather the opposite, wrote Alex Mashinsky, founder & CEO of Celsius Network, in an article on Monday.

According to him, Yellen’s track record as an economist and a civil servant is unimpeachable, but her ability to manage the current economic crisis and mounting debt is something to be worried about.

MMT FIAT maximalists in the House

Coming from a long line of Keynesian believers in MMT, Yellen advocates for creating endless amounts for fiat to grow the economy, said Mashinksy.

The Fed has already been printing money like crazy, with over 20% of dollar supply created in 2020 alone.

“Joe Biden along with Janet Yellen and J-Pow are gonna drive the Dollar into the ground,” said analyst Mati Greenspan.

Mashinksy argues that MMT is a dangerous ideology that injects boatloads of cash into the market, pushing the asset prices up, which only benefits large corporations and billionaires.

Although Yellen’s appointment can lead to Bitcoin restrictions and regulating DeFi but the fact that Yellen and Biden Administration need to ensure that the US Dollar remains the reserve currency, it would involve “funding new businesses and technologies in future industries such as Blockchain, Machine Learning, and AI.”

Mashinsky said it is “overdue” for the Fed and Treasury to give up their old ways and start taking advantage of crypto.

“The FED and the White House will be filled with Keynesian MMT FIAT maximalists in 2021. This guarantees that Bitcoin continues to hit new highs during the 2021–2025,” he wrote.

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Author: AnTy

US Treasury Dept And Federal Reserve Are ‘Studying’ Possible Launch Of A Digital Dollar

Speaking during the online Atlantic Council webinar, the U.S Deputy Treasury Secretary, Justin Muzinich, said his department, alongside the Federal Reserve, is looking at launching a central bank digital currency (CBDC) tied to the dollar in the future.

This announcement follows a trail of the Federal Reserve’s previous efforts to launch digital dollar wallets liable to the central bank. Federal Reserve Bank of Cleveland President Loretta Mester, revealed last month that legislation is being set up so each American would own a digital dollar account with the Feds.

Notwithstanding, the Boston Federal Reserve announced in August that they are testing over 30 blockchain projects to prepare a digital dollar. However, the research and development process for a CBDC is set to take years to complete – having begun in 2015 – the Boston Fed said.

Muzinich stated the learning curve in launching a digital dollar on a distributed ledger would produce “efficiency benefits and cost benefits.” He further targeted the slow U.S. efforts in introducing its own dollar:

“And I also think, more broadly, it’s important for the government to embrace innovation and not be scared by it.”

However, there are still a few factors to consider in launching a CBDC, including regulation of the CBDC to prevent money laundering activities while maintaining users’ digital privacy.

On regulation of a digital dollar, Muzinich states governments worldwide – especially Europe – should work to regulate cryptocurrencies globally. This arises from the different functions of cryptocurrencies, away from payments.

Questions of money laundering have taken center-stage in the adoption of cryptocurrencies. Still, other issues such as financial stability and monetary base of the cryptocurrency should also be put in check. To keep the consumers and users of the digital dollar safe and secure, Muzinich stated the existing laws governing fiat currencies should be extended to crypto.

“Treasury has made it clear that the obligation to comply with U.S. laws is the same, regardless of whether a transaction is denominated in traditional fiat currency or digital currency.”

“Existing laws apply to digital assets in no uncertain terms.”

He explains that even if cryptocurrencies comply with the KYC/AML/CFT rules, there’s still a danger of foreign parties disrupting the monetary base creating financial instability. This could arise if a stablecoin issuer shifts its reserve ratio from fully backed to partially backed, or changing the composition of assets in reserve.

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Author: Lujan Odera

U.S Treasury Secretary Says the Country Will Not Shut Down Despite Second Wave COVID-19 Fears

U.S Treasury Secretary, Steve Mnuchin, has ruled out the possibility of a second lockdown despite a spike in new COVID-19 cases within the United States. This comes as Wall Street and Asian markets dipped towards the end of last week in fears of possible second wave.

Mnuchin was speaking to CNBC reporter, Jim Cramer, on June 11 as he made these remarks. He went on to defend the position of keeping the economy open noting that a contrary move would cause more damage,

“We can’t shut down the economy again. I think we’ve learned that if you shut down the economy, you’re going to create more damage.”

Furthermore, many vital areas such as medical have been put on hold and ought to bounce back according to Mnuchin. The Treasury Secretary noted that they foresee a bounce back in the remaining two quarters of 2020.

The Optimistic Outlook

While the U.S remains as the highest country with active COVID-19 cases, Mnuchin signaled an optimistic future for the leading economy. He emphasized that President’s Trump approach was prudent coupled with the $3 trillion stimulus approval from the House of Reps and Senate. Notably, only about $ 1.6 trillion of the injected funds are the in U.S economy. Mnuchin has since highlighted that another $1 trillion will be pumped into the economy within the next month.

Following this progress, the U.S Treasury Secretary, said that his number one job is getting everybody to work; an initiative that is already underway in collaboration with the Trump administration. Mnuchin said,

“We have the Fed program, we have Main Street [lending program], which is going to be now up and running, and we’re prepared to go back to Congress for more money to support the American worker.”

Recently, another $3 trillion stimulus package was passed by the House Democrats sparking debate but is yet to be voted in the Republican-dominated Senate. The latter, however, prefer a more conservative approach towards increasing federal deficit to ease the COVID-19 economic effects.

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Author: Edwin Munyui

US Treasury Secretary Mnuchin: Companies Left Libra Association Due To Compliance Issues

Steven Mnuchin, the U. S. Treasury Secretary, has recently been interviewed by CNBC’s Squawk Box. During the interview, he talked about how some companies are abandoning the Libra Association as they are concerned with regulatory problems.

According to him, the project is really not “up to par” with the current laws for Anti-Money Laundering of the United States. This would prompt the government to take action against them, so they have understood that it was not a good idea to side with Libra before the project was really up to par with what was expected.

Recently, PayPal, Mastercard, eBay, Stripe, Visa and other major companies have all announced that they would drop from the Libra Association, which would govern Facebook’s upcoming stablecoin. Most of the companies decided to back away from the Libra as the G7 working group reported that Libra was a major potential threat to international stability.

When PayPal left the association, people from the company affirmed that the company “remained supportive” of Libra but that it would not be a part of it anymore. That is the general consensus now. Most companies don’t really want to burn the bridges, but they noticed that backing the Libra is possibly not the greatest idea right now.

The anti-Libra stance, however, is not taken by everybody. The CEO of Coinbase, Brian Armstrong, has recently criticized the senators of the country for asking companies to leave the project (which they did). According to him, this is “un-American”.

Right now, Facebook is fighting to keep its partners on its team and to convince the regulators that it can provide a good service, but the situation is far from certain.

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Author: James W

WV’s ‘Military Mobile Voting Solution,’ Had An Unsuccessful Hacking Attempt in The 2018 Election

In an official address by the Secretary of State, West Virginia, someone tried to infiltrate the blockchain-based voting system used by the state in the 2018 election cycle.

Unsuccessful Attempt at Breaching Blockchain

According to the official report by the Secretary of State, West Virginia, Mark Warner, the hackers were unsuccessful at gaining access to the voting system. The hackers tried to infiltrate the system during the pilot program of a “military mobile voting solution,” a decentralized application that allows eligible voters from overseas to vote for their preferred candidate remotely.

Developed by Voatz, an Overstock Medici Ventures backed blockchain firm, the voting app is a secure and safe portal for voters to make their ballots, gather information and protect the sanctity of the voters’ identities. The matter is currently under FBI investigation to locate the hackers hence much information cannot be shared.

“Although the details of the investigation cannot be disclosed, we can say that no votes were altered, impacted, viewed or in any way tampered with. […] There’s not a shred of evidence that even a single vote was changed in the 2018 election.”

A Democratized Voting Application

In June this year, Voatz raised $7 million USD in a Series A funding led by Overstock’s Medici Ventures. The funding has been used to develop over 30 voting decentralized applications boosting the security and transparency of elections, mainly in the US.

The voting app developed by Voatz, uses blockchain technology to verify and record voters’ ballot receipts and biometric security identification verification to make sure the right vote is counted. Since its launch, the case with West Virginia amounts to the first case of attempted breach of the system, but it was easily detected and reported to relevant authorities.

Following successful trials in West Virginia and Denver, Colorado the company launched voting for the municipal primary election in Utah in August.

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Author: Lujan Odera

US Secretary of State Wants Bitcoin To Be Regulated Similar to Other Electronic Transactions

Mike Pompeo, the U. S. Secretary of State, wants to regulate Bitcoin (BTC). According to him, the asset should be regulated in the same way that all other financial transactions which made online currently are.

During a recent interview with CNBC’s Squawk Box, he affirmed that anonymous transactions are very risky and that terrorists might start to use it if they remain unregulated. According to him, the country has moved forward a lot when it comes to tracking money, so not doing it would open a breach for illegal activities.

To him, if anonymous transactions become the norm, this would greatly decrease the security of the whole world, which can become an issue as time passes.

The host of the show, Koe Kernan, brought up that the Treasury Secretary Steve Mnuchin affirmed that more Bitcoin is used for illegal activities than cash. Pompeo supported the other secretary in his allegations against crypto.

According to Mike Pompeo, however, the main difference between him and his colleague is that Mnuchin wants a very tight and specific regulation on Bitcoin, while he believes that the asset should just be regulated as any other asset currently is.

Unfortunately, neither of the secretaries seem to understand Bitcoin very well. It has been proved several times that fiat currency is used way more than Bitcoin in money laundering and terrorism financing, so there is no excuse to keep being ignorant on the subject.

Bitcoin is also very hard to regulate, so they would probably have a very difficult time to do the same that can be done to similar digital transactions.

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Author: Lillian Peter