Yellen: Crypto regulation should be based on risk

Yellen: Crypto regulation should be based on risk

In a comprehensive speech on regulating cryptocurrencies, Treasury Secretary Janet Yellen made the case that regulation should be based on risks, not technologies, balancing between the improvements digital assets could offer our payment system and the hazards they present.

“Wherever possible, regulation should be ‘tech neutral,’” Secretary Yellen said in a speech before American University’s Kogod School of Business Center for Innovation. “Consumers, investors, and businesses should be protected from fraud and misleading statements regardless of whether assets are stored on a balance sheet or distributed ledger.”

Yellen’s comments come after President Biden signed an executive order last month calling for a whole-of-government approach to study how to regulate crypto, tasking the Treasury with leading many of the studies. Yellen laid out her thinking and Treasury’s approach to digital assets and its work as part of the president’s order.