Steven Mnuchin: Misusing Libra is a National Security Issue and Arouses US Government’s Serious Concerns

[ChainDD report] July 17 (ChainDD) At his press conference on July 15, Steven Mnuchin, the Treasury Secretary of US, said the US government has serious concerns on Facebook proposed cryptocurrency Libra since it may be used for illegal activities such as money-laundering and terrorism funding.

“Cryptocurrencies such as bitcoin have been exploited to support billions of dollars of illicit activity like cyber crime, tax evasion, extortion, ransomware, illicit drugs and human trafficking,” Mnuchin said. “Many players have attempted to use cryptocurrencies to fund their maligned behavior. This is indeed a national security issue.” As to Libra and other cryptocurrencies’ development, “our overriding goal is to maintain the integrity of our financial system and protect it from abuse.” He cited US president Donald Trump’s recent comment that Bitcoin is very volatile and based on thin air and said: ”We are concerned about the speculative nature at Bitcoin and will make sure that the U.S. financial system is protected from fraud. ”

According to Munuchin, Treasury has been very clear to Facebook, Bitcoin users, and other providers of digital financial services that they must implement the same anti-money laundering and countering financing of terrorism -- known as AML/CFT -- safeguards as traditional financial institutions. “We will not allow digital asset service providers to operate in the shadows.” The US Financial Crimes Enforcement Network (FinCEN), a bureau of the US Department of the Treasury that seeks to combat money laundering and other financial crimes, “will hold any entity that transacts in Bitcoin, Libra, or any other cryptocurrency to its highest standards.”

Mnuchin revealed the officer of the Treasury has had multiple meetings with other regulators and representatives of Facebook to express their concerns on Libra. He thinks Facebook has a lot work to do “before they get us comfortable”. He had extensively discussed the cryptocurrency issue with Jerome Powell, Chairman of the US Federal Reserve. He will address the issue on G7 finance ministers’ meeting this week.

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