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• Officials are evaluating the potential use of cryptocurrency for illegal purposes such as terrorism.
The government is imploring new ways to impose guardrails while allowing people to invest in cryptocurrency with their heart’s content.
• A regulated digital asset may cut down the need for volatile crypto assets as it will be much safer.
The Biden government has been keeping an eye on the volatile digital assets market. The current challenging situations of the cryptocurrency market have made officials believe a fresh approach needed to solve them as per Washington Post.
Regulators and Policymakers Discuss Preventive Measures to Protect Investors
The US Government officials know about the risk of the crypto market earlier this month by the Treasury Department. Several regulators also discussed the same with the Office of the Currency and the Consumer Financial Protection Bureau (CFPB). Currently, officials are exploring the potential use of cryptocurrency for illegal purposes. This includes illicit financing activities such as terrorism. In addition, they have also discussed whether preventive measures are needed to protect regular crypto investors.
A Regulated Digital Currency may Reduce the Need of Volatile Crypto
Currently, regulators do not see any severe threat posed by the fluctuating crypto market. They think that the stability of the financial market will remain unaffected by the volatility. However, the risks must be monitored irrespective of the market stability. The government is imploring new ways to impose guardrails while allowing people to invest in cryptocurrency with their heart’s content. The government is aware of all kinds of risks and things they need to look out for. But, they are still in the type of wait-and-see attitude.
Lael Brainard, a member of the Federal Reserve’s Reserve’s board of governors in an article, explained the benefits of a digital currency created and regulated by the Central Bank. A controlled digital asset may cut down the need for volatile crypto assets as it will be much safer. Bitcoin recently crashed by 40%, which has prompted many policymakers to revise their framework regarding cryptocurrencies.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
