Senate Confirms Janet Yellen as Treasury Secretary

By Jeff Benson

The US Senate confirmed President Joe Biden's nomination of Janet Yellen as Treasury Secretary on Monday in an 84-15 vote.

Yellen, who previously helmed the Federal Reserve from 2014 to 2018, described herself as "not a fan" of Bitcoin in October 2018. She's also referred to it as a "highly speculative asset."

More recently, during the confirmation process for the Treasury role, Yellen updated her thoughts on cryptocurrencies, which she thinks can benefit the financial system.

In oral testimony in front of the Senate Finance Committee, Yellen answered a question about cryptocurrencies being used to finance terrorism by stating that regulators and policymakers should "examine ways in which we can curtail their use," at least with regard to illicit purposes.

Her written testimony was more expansive on the issue:

“I think it important we consider the benefits of cryptocurrencies and other digital assets, and the potential they have to improve the efficiency of the financial system,” she wrote.

Though cryptocurrencies can be used for terrorism and money laundering, she said, “I think we need to look closely at how to encourage their use for legitimate activities while curtailing their use for malign and illegal activities."

Importantly, she also vowed "to work closely with the Federal Reserve Board and the other federal banking and securities regulators on how to implement an effective regulatory framework for these and other fintech innovations.”

It's something that's long been missing, but it may be a promise she can deliver on. Yellen and Chairman Jerome Powell already have a strong rapport, having served together for six years on the central bank.

As Treasury Secretary, Yellen will be in charge of several agencies that deal with cryptocurrency, the most notable being the Financial Crimes Enforcement Network (FinCEN) and the Office of the Comptroller of the Currency (OCC).

The former guards against terrorism funding and money laundering; the latter, which is an independent bureau, regulates national banks and credit unions, including the first cryptocurrency institution with a national charter, Anchorage.

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