There’s a chance that some of the shine might be rubbing off Bitcoin with a new administration in charge.
On Tuesday, Treasury Secretary Janet Yellen suggest that Team Biden might be tough on Bitcoin and cryptocurrency in general. She suggested this week that lawmakers curtail the use of cryptocurrencies due to concerns that they are mainly used for illegal activities.
What does that mean? Well, it suggests the Biden administration might ramp up regulation of cryptocurrencies.
During Yellen’s confirmation hearing on Tuesday, she was asked point blank by Senator Maggie Hassan about the dangers of terrorists using cryptocurrencies. “You’re absolutely right that the technologies to accomplish this change over time, and we need to make sure that our methods for dealing with these matters, with terrorist financing, change along with changing technology,” Yellen said.
“Cryptocurrencies are a particular concern. I think many are used – at least in a transaction sense – mainly for illicit financing. “And I think we really need to examine ways in which we can curtail their use and make sure that money laundering doesn’t occur through those channels.”
The price of bitcoin has soared almost 300% in the past year alone. The comments from Yellen caused it to dip Wednesday to $34,183.57, a drop of 7.59%.
While it still is a darling of the investment world, Yellen’s comments were consistent with quotes made from Europe’s Central Bank President Christine Lagarde. She said last week that Bitcoin had been used for some”totally reprehensible money-laundering activity.”
Currently cryptocurrencies are not controlled by a centralized authority, like a central bank, so they are mostly untraceable, which appeals to criminals.