It was a topsy-turvy week for President Biden’s Treasury Secretary pick, Janet Yellen. Last Tuesday, she said in an oral testimony that “cryptocurrencies are of particular concern” when it comes to enabling crime and terrorist activity. On Friday, however, she was back in the crypto community’s good graces, striking a more balanced tone in her written testimony by acknowledging crypto’s “potential” to improve the financial system.
To be fair, Yellen’s remarks on Tuesday came in response to a question from Democratic Senator Maggie Hassan who asked her to outline some emerging technological concerns and how the Treasury should combat new forms of terrorism criminal financing. Yellen’s response – “we really need to examine ways in which we can curtail their use” – was left to the end of the five minutes allocated to Sen. Hassan for questions.
As Treasury Secretary, Yellen would have purview over the Financial Crimes Enforcement Network (FinCEN), a Treasury bureau geared to combatting money laundering and terrorism. Under Trump, Treasury Secretary Steve Mnuchin proposed new rules for reporting transactions to private crypto wallets, drawing much ire from the community who rightfully questioned why they should be bound to stricter rules than regular banks.
Fortunately, President Biden put a freeze on all federal rulemaking, meaning the FinCEN proposal would first be reviewed by Biden appointees, like Yellen and her designated FinCEN chair. The Senate Finance Committee unanimously cleared Yellen’s nomination on Friday, with a full Senate vote set to take place today.