The private sector’s engagement in the digital assets industry is critical, according to government aides from the US Treasury Department, Commerce Department, and New York State Department of Financial Services, not only for technological innovation but also to guarantee it is not used for illicit reasons.
Officials from the reporting three agencies spoke at a New York conference that was hosted by blockchain data platform Chainalysis Inc. on Thursday, after President Biden’s executive order in March for federal agencies to research cryptocurrencies.
The International Trade Administration of the US Commerce Department issued a notice on Thursday seeking community feedback as it builds a strategy for increasing US competitiveness in and harnessing digital-asset technology. From July 5th, the public is invited to respond to 17 questions including competitiveness, similarities to traditional banking, microfinance considerations, and technical advancement.
According to Carole House, director of cybersecurity and secure digital innovation at the White House’s National Security Council said that the comment demands are “completely earnest,” and public consultation is critical in assisting the government in making rational choices on policies regarding the digital-assets market.
Image Source: Bank Info Security
“So, all of these opportunities, with the government…putting out requests for comments, we mean it, we need that data, we need that input.”
Ms. House
According to Alessio Evangelista, FinCEN’s associate director for enforcement and compliance, the cryptocurrency industry and other stakeholders submitted more than 10,000 comments in reply to the Treasury’s Financial Crimes Enforcement Network’s public comment related to compliance with the travel principle in the cryptocurrency industry.
For any bitcoin exchanges surpassing $3,000, the budget of the 2020 rules would compel cryptocurrency trading venues and banks to preserve logs of a customer’s cryptocurrency transactions and intermediaries, which include identity verification. Furthermore, any bitcoin deals involving displaced wallets that surpass $10,000 would have to be reported to FinCEN within 15 days by banks and trading platforms.
“It is important to us that we hear from you. We read every single comment and we are carefully considering them as we move forward. Addressing the illicit finance and national security risks related to the travel-rule compliance and unhosted wallets remain top of mind for us.”
Mr. Evangelista
Superintendent Adrienne Harris of the New York State Department of Financial Services proclaimed that the state wants to speed up the licensing and company registration procedures for digital assets and provide more direction to the industry.
According to Ms. Harris, New York’s financial authority, which has a large impact on financial regulation and enforcement across the country, has 33 licensed crypto firms and is considering issuing guidelines on stable coins.
Ms. Harris believes that the NYDFS has recruited 15 workers to its crypto currency section this year and plans to increase the size by the end of the year. She invites private-sector professionals to join her team in order to ensure that the regulator takes a holistic perspective.
Another piece of recommendation from the agency recently stated that bitcoin companies should employ blockchain analytics technologies to help avoid and control financial risks and unusual activity. Ms. Harris went on to say that, as a result of the situation in Ukraine, the NYDFS now uses blockchain analytics.
“I’m a firm believer that we can be good for consumers, good for markets, but also cement New York’s place as the financial capital of the world, [and] be a great place to do business whether you’re in crypto or other areas of financial services.”
Ms. Harris
She went on to say that the NYDFS wants to keep its position as the leading administrator of virtual currency, particularly while the federal government considers methods to regulate the business.
Information from The Wall Street Journal