Following several legal and regulatory victories in the cryptospace, the Treasury is looking to expand its powers. Additionally, this time, its reach will be global.
Wally Adeyemo, Deputy Secretary of the Treasury, iterated this position and more at the Blockchain Association’s policy summit on Wednesday, November 29, in Washington, D.C.
Adeyomo’s remarks came on the heels of sanctions by the Treasury against Sinbad, a cryptocurrency mixing service, for allegedly aiding North Korea’s Lazarus Group in money laundering activities.
The Treasury Encouraged Self-Regulation in 2022
At the Consensus 2022 conference in Austin, Texas, Adeyemo encouraged the innovative nature of the industry and pointed out the opportunities the cryptospace had to change things. Also, he called for a partnership between key players and the government to create avenues for cooperation per regulation.
According to his prepared statement, many firms didn’t cooperate. Adeyemo also addressed innovators who operate outside the law and aid illegal activities.
He said, “My message is simple: We will find you and hold you accountable.” Additionally, Wally indicated that the recent actions taken by the Treasury against Binance were a consequence of aiding and abetting criminals in their activities.
The Treasury also requested input from industry stakeholders after introducing new rules to enable the government to expand its oversight activities.
Furthermore, Adeyemo called on the crypto industry to create an information-sharing platform similar to a newly created ecosystem by the American Banker’s Association (ABA).
Congress Received Proposals for New Tools
Also, Wally indicated that the Treasury had sent proposals for new tools to fight illicit crypto activities to Congress. He called on Congress to create an additional sanction framework that enables the Federal Government to prevent and expose firms that assist terrorists, fraudsters, and other criminals to perpetuate their crypto crimes.
Adeyemo also called for an upgrade to the financial regulations to help keep up with the times. Consequentially, Wally hinted at plans to regulate stablecoin providers beyond America’s shores.
As for cooperation with America’s allies, Adeyomo said, “Finally, in addition to working with Congress, we are committed to working with the Financial Action Task Force (FATF) to make sure our allies and partners around the world join us in updating their regulatory approach.”
Also, he indicated that the last time the financial services industry had an upgrade was in 2001, immediately after the 9/11 terrorist attacks.
Increased Crypto Regulatory Scrutiny is Coming
This year, the Treasury came out “all guns blazing” against the cryptospace. Then again, the continuing string of crypto failures compelled regulators to act in the public’s best interest.
Moving forward, the U.S. Treasury and other regulatory bodies will coordinate activities to marshal the industry in a direction that encourages innovation but punishes criminal behavior.
The time has come for that already.