Treasury nominee Yellen is looking to curtail use of cryptocurrency | Hacker News Reader

Treasury nominee Yellen is looking to curtail use of cryptocurrency

arstechnica.com

19 pointsxvector24 comments

Can’t say I’m a fan. Blatant governmental power grab.

Yellen is 74 years old. I wonder if she even understands what crypto is and what it brings to the world of finance.

More to the point, she was Fed Reserve Chairman under Obama, which makes her a prime suspect here.

Crypto currency is a direct assault on that agency's ability to levy the most insidious and regressive tax of all on the American people in order to subsidize the billions of dollars each year that Congress wastes on pork-barrel spending:

Inflation.

As an active trader in these markets, it's frustrating that a 74 year old's brief and broadly incorrect statements can cause a 7.5% downward move over the course of a day. Cash is the #1 driver of illegal transactions. Darknet markets are a drop in the bucket of aggregate global illegal activities compared to daily transactions in various international fiat currencies. She's just preaching the narrative that she must, as another puppet of the state.

Frustrating and sad, as someone interesting in the underlying technology and the ability to democratize payments for people around the world.

We desperately need term and age limits for office. We cannot have ancient people that don’t understand technology regulating it. They simply drag down future generations.

Is it ageist? Sure. If anyone has a better solution in mind, they should propose it.

There should be some ability to more easily disseminate the fact that they have said factually incorrect things, or some mechanism that broadly communicates the correct facts. Or maybe call them back to live TV and have someone actually confront them with the verifiable information.

Yellen said:

> "Many [cryptocurrencies] are used, at least in a transactions sense, mainly for illicit financing."

Chainalysis, a firm that does compliance and criminal research professionally for governments, says that the total funds received by criminal entities is only 0.34% of all activity in crypto.[1]

Hopefully the department does its due diligence and realizes that rhetoric is diverging from reality.

[1]: https://blog.chainalysis.com/reports/2021-crypto-crime-repor...

I'm somewhat skeptical of the analysis when it revised the share of criminal activity in 2019 from 1.1% to 2.1%--in other words, more than doubling that value. That revision is on the basis of "the identification of more addresses associated with criminal activity that were active in 2019."

Your citation that it's "only 0.34%" is a somewhat dishonest distillation, because the report itself advises that the number is only for known criminal activity, and that the number is expected to rise over time as well.

What I would instead like to see, and that this report does not illuminate at all, is a breakdown of how all transactions looks. How many transactions are related to cryptocurrency-specific transactions, such as mixing coins or moving between hot wallets and cold wallets? How many transactions are related to speculation (e.g., trading one cryptocurrency for another)? How many transactions are associated with known entities, e.g. the Bitcoin address of an online (non-darknet) marketplace? How many transactions are unclassified?

Even if 90% of illicit financing transactions are being missed by Chainalysis, the original claim is that "many are used [...] mainly for illicit financing" is outright false.

By 'transactions sense' I think Yellen means using cryptocurrency to buy and sell goods and services. The Chainalysis figure seems to include people simply swapping USD for Bitcoin. So in that sense Yellen may be correct

I sincerely doubt she cares what the data says in this case. She's building a narrative.

She's using it as a pretext for when they eventually ban or regulate crypto to death, not to genuinely inform anyone.

Subject so-called "stable coins" to audits to verify that they are indeed fully backed as claimed. If this cannot be verified, it is effectively fraud and subject to prosecution.

Do this and watch bitcoin freefall.

I think that's the plan.

DAI is the most trustworthy stablecoin you can buy today but Bitcoin is nowhere close to free fall.

The flow of Tether into Bitcoin generally correlates to the rise in price...

Tether is being used to manipulate bitcoin up and down.

https://ag.ny.gov/press-release/2019/attorney-general-james-...

https://www.forbes.com/sites/robkniaz/2020/12/16/the-problem...

Researchers at UC Berkeley disagree

https://voxeu.org/article/stable-coins-dont-inflate-crypto-m...

Did these researchers review their financial records? I don't think so.

If Tether is really backed as they claim, why not prove it to the AG of NY? Instead they delay and obscure as they mint tethers and inflate bitcoin.

https://bitcoinwarrior.net/2021/01/deltecbank-reveals-huge-p...

They filed the docs already.

No, they haven't. And their offshore bank has already admitted that reserves are invested in bitcoin.

https://crypto-telegraphs.com/2021/01/20/bitfinex-claims-its...

https://www.fxstreet.com/cryptocurrencies/news/tether-awaits...

have you considered the possibility that they are backed? Or you can't handle that in your narrative

Can your narrative handle the fact that they are already backing away from the claim that Tether is 100% backed by USD?

https://www.bloomberg.com/news/articles/2019-04-30/tether-sa...

There is little to no regulation in crypto. This makes fraud not only possible and easy but also highly probable.

The dollar is the most pervasive money laundering channel in history, yet this never seems to bother anyone at the treasury.

Much of government spending is an illicit use of taxpayer's money.

So what's the disconnect?

Not Invented Here syndrome?

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