The United States, through its Treasury Secretary Steve Mnuchin, has declared that they are closely watching the digital currency ecosystem and could turn the US dollar into a cryptocurrency in the distant future.
According to Express, Steve Mnuchin has said that in line with the recent popularity of bitcoin, the Treasury had made proposals of converting the US fiat currency into a “digital dollar.”
However, the high-ranking official hinted that the project might not be undertaken any time soon because the government is still wary of the cryptocurrency mania. Mr. Mnuchin also opined that what matters most to him at the moment is to ensure “bad people cannot use these currencies to do bad things.”
He talked about the need for consumers to fully understand that digital assets are very volatile and thus it may be easy for them to find financial difficulties. He said: “I want to be sure consumers trading this understand the risks. I’m concerned consumers could get hurt.”
Steve Mnuchin has called for an urgent G20 summit concerning cryptocurrencies, to avoid bitcoin being used like “Swiss numbered bank accounts.” He also pointed out that despite the decentralized nature of Bitcoin and cryptocurrencies, the US government is currently investigating how to track bitcoin activities.
One principal way that regulators can form an understanding of a crypto demographic is by applying Know Your Customer (KYC) guidelines. Mnuchin told Bloomberg that users’ wallet provider, at least in the United States, falls under the same rules as a traditional bank. It is around this point that the American secretary hopes to garner support in a G20 summit.
One of Bitcoin’s greatest attributes is its ability to help users carry out pseudo anonymous transactions and its decentralized nature. The digital currency offers a seamless method of money transfer without going through a third party.
This power of anonymity in other privacy-centric coins makes specific cryptocurrencies a great tool in the hands of evil actors.
Governments all over the world are relentlessly formulating regulations that will reduce the anonymity of crypto transactions. For example, BTCManager reported on January 11, that South Korean authorities have started scrutinizing bank accounts of bitcoin exchanges as part of the ongoing cryptocurrency regulation in the country.