New York Attorney General Letitia James has warned US congressional leaders about the potential risks posed by Bitcoin and other cryptocurrencies to the dominance of the US dollar globally. She stressed the need for stronger federal regulations to safeguard investors from fraud and criminal activities within the cryptocurrency market.
In a letter to Congress, James highlighted the importance of a federal regulatory framework for digital currencies. She pointed out that the lack of regulation exposes users to fraud and significant price volatility. According to James, Bitcoin poses a real threat to the dollar’s global supremacy, especially as more businesses and individuals choose digital currencies for international money transfers.
James also echoed concerns raised by BlackRock CEO Larry Fink, who suggested that Bitcoin could act as a hedge against the dollar due to US fiscal challenges and inflation. She emphasized the need for greater protection for millions of New Yorkers actively engaging in cryptocurrency transactions.
The Attorney General specifically addressed stablecoins, which are cryptocurrencies tied to stable assets like the US dollar. She urged lawmakers to enforce regulations requiring stablecoin issuers to have a US presence and back their tokens with US dollars or treasuries. Stablecoins, she noted, facilitate value exchange among cryptocurrencies but can be manipulated without proper regulation.
James further demanded increased protection against crypto scams that have caused substantial financial losses. She cautioned against including digital assets in retirement accounts like IRAs due to their volatility and risk. Additionally, she argued that comprehensive crypto regulations would enhance national security by mandating crypto firms to register with regulators and comply with anti-money laundering protocols.
— new from Bitcoinist.com