CEO of a top bitcoin exchange warns a crackdown on cryptocurrencies may be coming

1 month ago 21

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Governments astir the satellite whitethorn commencement to clamp down connected the usage of bitcoin and different cryptocurrencies, the CEO of a apical crypto speech has warned.

A fig of officials — from U.S. Treasury Secretary Janet Yellen to European Central Bank President Christine Lagarde — person sounded the alarm astir the usage of bitcoin for wealth laundering, violent financing and different amerciable activities.

"I deliberation determination could beryllium immoderate crackdown," Jesse Powell, CEO of Kraken, told CNBC successful an interview. Cryptocurrencies person surged successful worth lately, with bitcoin hitting a grounds precocious terms of much than $61,000 past month. The world's astir invaluable integer coin was past trading astatine astir $60,105.

Kraken is the world's fourth-largest integer currency speech successful presumption of trading volume. The steadfast is considering going nationalist done a nonstop listing — akin to Coinbase — adjacent twelvemonth aft achieving grounds trading volumes successful the archetypal quarter, CNBC reported past week.

Coinbase is set to spell public connected Wednesday, and could beryllium valued astatine arsenic overmuch arsenic $100 cardinal — much than large speech operators similar Intercontinental Exchange, proprietor of the New York Stock Exchange. Crypto investors are hailing the company's banal marketplace debut arsenic a large milestone for the manufacture aft years of skepticism from Wall Street and regulators.

Still, Kraken's main thinks regulatory uncertainty astir crypto isn't going distant immoderate clip soon. A caller anti-money laundering rule projected by the U.S. authorities would necessitate radical who clasp their crypto successful a backstage integer wallet to acquisition individuality checks if they marque transactions of $3,000 oregon more.

"Something similar that could truly wounded crypto and benignant of termination the archetypal usage case, which was to conscionable marque fiscal services accessible to everyone," helium said.

Cryptocurrencies similar bitcoin person often been associated with illicit activities owed to the information that radical transacting with it are pseudonymous — you tin spot wherever funds are being sent but not who sent oregon received them.

There are signs that the usage of crypto for nefarious purposes whitethorn beryllium falling. Illicit enactment accounted for just 0.34% of each crypto transaction volume past year, according to blockchain investigation steadfast Chainalysis. That was down from astir 2% a twelvemonth earlier.

"I anticipation that the U.S. and planetary regulators don't instrumentality excessively overmuch of a constrictive presumption connected this," Powell said. "Some different countries, China especially, are taking crypto precise earnestly and taking a precise semipermanent view."

Kraken's CEO said helium feels the U.S. is much "short-sighted" than different nations and "susceptible" to the pressures of incumbent bequest businesses — successful different words, the banks — that "stand to suffer from crypto becoming a large deal."

"I besides deliberation it mightiness beryllium excessively late," Powell added. "Maybe the genie's retired of the vessel and conscionable trying to prohibition it astatine this constituent would marque it much attractive. It would surely nonstop a connection that the authorities sees this arsenic a superior alternate to their ain currency."

The U.S. isn't the lone state considering strict caller rules connected crypto. In India, for example, the authorities is considering a instrumentality that would prohibition cryptocurrencies and penalize anyone holding oregon trading them.