Friday, April 19, 2024

Cryptocurrency execs to face U.S. congressional panel

Executives of eight major cryptocurrency firms have been called to testify before a U.S. congressional committee on Dec. 8, reports the BBC. Witnesses called to appear include Coinbase’s Alesia Haas, Circle’s Jeremy Allaire, and Bitfury’s Brian Brooks. It will be the first time companies representing the controversial sector have been questioned in this way. U.S. officials across the political spectrum have called for more scrutiny of cryptocurrencies. Senator Elizabeth Warren of the Democratic Party has called for tougher regulation of the sector, and former president Donald Trump has described cryptocurrencies as a “scam”. Brooks previously served as a top banking regulator under the Trump administration and had a role in policy-making around cryptocurrencies. Cryptocurrencies are not currencies in the traditional sense, although they can be used to make payments. They are stored in a “digital wallet” and act more like investment vehicles or securities, with a high degree of volatility. The anonymity of paying through cryptocurrencies is appealing for criminal activities such as drug dealing and ransomware attacks. However, crypto supporters say the view that they are predominantly for circumventing the law is outdated and that innovation in this area offers huge potential. China has declared cryptocurrency transactions illegal, a move India looks set to follow. Many other central banks are eyeing the sector warily and discussing regulation. On the flip side, El Salvador recently declared Bitcoin, the most widely established crypto-currency, to be legal tender and its president plans to build a Bitcoin city at the base of a volcano, with the cryptocurrency used to fund the project. Across the U.S., states and municipalities have begun toying with plans to integrate them into their operations. The mayor of Miami and mayor-elect of New York have ambitions to make their cities centres for cryptocurrency business. The hearing before the U.S. House Financial Services Committee will focus on “the challenges and benefits of financial innovation”, according to the committee announcement. The other chief executives asked to appear are Sam Bankman-Fried of FTX Trading, Chad Cascarilla of Paxos, and Dennelle Dixon of the Stellar Development Foundation.

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