U.S. Treasury Secretary Steven Mnuchin addressed the country on the subject of cryptocurrencies yesterday in a speech that was clearly aimed at the new breed of cryptocurrencies such as Facebook’s Libra as much as the old guard like Bitcoin. The ten-minute hatchet job rehashed all the well-worn tropes that cryptocurrency naysayers like to trot out about illicit use of virtual currencies, but cited Facebook’s proposed token on several occasions in relation to regulation, highlighting the government’s sudden shift in focus.
“Very Serious Concerns” Over Libra
Mnuchin spent the majority of the time reminding everyone of the various nefarious ways in which cryptocurrencies have been used in the past, and specifically the ways in which Libra itself could be used, citing the treasury department’s “very serious concerns that Libra could be misused by money launderers and terrorist financiers.” He also cited the misuse of Bitcoin as a “national security issue”, a line that must have temporarily sent heart rates soaring among those with a vested interest in the digital currency, but they needn’t have worried. Mnuchin simply went on to praise the work done by the regulatory bodies in clamping down on such illicit use cases, reminding people of the work done by Financial Crimes Enforcement Network (FinCEN) and reminding viewers that the government would continue to clamp down on illegal crypto use.
Key quotes from the Mnuchin press conference ? pic.twitter.com/w5yXWWMCR3
— Alex Krüger (@krugermacro) July 15, 2019
In truth, the talk was something of a non-event and seemingly served just to act as a reminder that the government wasn’t about the rollover and let single entities compete with the U.S. dollar, even though Facebook has stated that this is not its aim. Mnuchin’s talk failed to offer anything to back up the fears that had been instilled on social media in the short lead up to it, and didn’t end up telling anyone involved in crypto anything they didn’t already know. The Bitcoin price reacted in line with this sentiment, dropping temporarily to $10,380 during the talk before rallying to $11,090 in the hours following it
As we suggested when Libra was first announced a month ago, all the furore it has kicked up, and will continue to kick up, is great news for Bitcoin and the crypto scene in general as it will act as a lightning rod for the regulation and criticism for the months to come, with the potential for clear regulations to come as a result.