US Financial Regulator Warns Against Strict Cryptocurrency Rules

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Cryptocurrencies are prevalent in South Africa and gaining traction as an alternative on the internet currency. This post, therefore, illustrates the use of cryptocurrency in the facilitation of criminal activity by means of the critique of current literature. Lastly, an exposition of the crimes is presented in order to demonstrate how cryptocurrencies can be made use of as a tool and target in the facilitation of cybercrime. Concomitantly, cryptocurrencies are also establishing themselves as an excellent currency for cybercriminals due to their unregulated and pseudo-anonymous nature. Cryptocurrencies can be used either as a tool or target in the facilitation of cybercrimes, such as cyber cash laundering, cyber extortion, phishing, hacking, cyber fraud and other financial crimes such as Ponzi and investment scams. Given the very technical, decentralised and therefore complicated nature of cryptocurrencies, it is vital for criminologists to have a standard understanding of the modus operandi utilised in ‘cryptocurrency crime’. This post starts with a brief discussion on the history of cryptocurrencies. The technical underpinnings of a cryptocurrency are thereafter explained in order to contextualise their use in the facilitation of cybercrime.

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Gensler stated his aim was to bring "similar protections to the exchanges exactly where you trade crypto assets as you may well expect at the New York Stock Exchange or Nasdaq". Hsu is, in his personal words, "a profession public servant and a bank supervisor at my core". Today, fintechs and technology platforms are devising payment processing tools that "bring terrific promise", he stated, "but also risks". As one particular of Hsu’s first acts at the OCC, he asked staff to review a Trump-era decision to give national trust charters to businesses that give custody solutions for cryptocurrencies. Gensler said the Treasury department has been focused on "anti-income laundering and guarding against illicit activity" in the crypto market. By installing Hsu at the OCC, Yellen also signalled a change in strategy to crypto. The danger is that new and improved approaches give rise "to a huge and significantly less regulated shadow banking system". Janet Yellen, the Treasury secretary, has said she fears bitcoin is used "often for illicit finance". While Hsu believes there is no turning back from innovations such as the blockchain technology applied in cryptocurrencies, he said in congressional testimony this month that the present enthusiasm for banking innovation reminded him of the years leading up to the financial crisis.