US Senator Elizabeth Warren continued her criticism of cryptocurrencies and drew the attention of Treasury Secretary Janet Yellen to possible threats to the US financial system.
Thus, Massachusetts Senator Elizabeth Warren, who competed with Joe Biden for the right to become the US presidential candidate from the Democratic Party; in an interview with CNBC called for an assessment of the risks that the integration of cryptocurrencies into the financial system entails.
In addition, at a hearing at the Senate Banking Committee entitled “Cryptocurrencies: What Are They For?” Elizabeth Warren noted that while the relatively small cryptocurrency market of $ 1.5 trillion poses a very serious threat to the colossal US banking system, which is $ 25 trillion.
According to Warren, the financial system has many problems at the moment. The senator believes that it is necessary to research the positive and negative aspects of digital assets. In order to understand how they can affect the traditional financial system.
Warren also noted that the wealth tax in the United States should be levied, among other things, on cryptocurrency assets. According to the senator, it does not matter in what form the assets are located. If their size falls under the current legislation, then an appropriate tax should be levied on them annually.
Letter from Elizabeth Warren to Janet Yellen
On July 26, Warren called on US Treasury Secretary Janet Yellen to develop rules to regulate the crypto market as soon as possible. In the letter, Warren said the Financial Stability Oversight Board must act quickly. Using all the powers at its disposal, and called for “regulating the markets before it’s too late”.
She pointed out that the lack of regulation of cryptocurrencies poses a threat to retail investors and the financial system.
The fact that banks and hedge funds are more interested in cryptocurrencies seems to have worried Warren. The increase in ransomware attacks by hackers using cryptocurrencies is one of the issues that Warren pointed out.
She also went on to argue that cryptoassets are not as decentralized as they seem. She believes that most of them are controlled by founders and miners.
Negative attitude towards cryptocurrencies
Senator Warren is known for his constant negative comments about cryptocurrencies. Back in June, Warren asked the Senate Banking Committee to impose stricter rules on cryptocurrencies, but received no concrete response.
While Warren is tough on cryptocurrencies, she is warm about the workings of the CBDC. The Fed has yet to take concrete steps for the digital dollar, and the project hasn’t gone through the research process. The institution is late with the CBDC theme but wants to take drastic steps. For this reason, it is not customary to race with China over digital fiat currency. However, with the proliferation of the digital yuan next year, we see concrete steps taken by the Fed.
Recovery of cryptocurrency markets
Regulatory rhetoric aside, the cryptoasset markets have continued to pick up profits with a 5.4% increase in total market capitalization in the last 24 hours.
Bitcoin has overcome the psychological barrier of 40 thousand dollars, at the moment the price has slightly decreased and Bitcoin is trading in the region of 38 570 dollars. Ethereum has been overshadowed by its older brother, rising 4.6% to $ 2,300.
US politicians and bankers may scold cryptocurrency, but the general public is still clearly demanding it.