yellen wants encourage cryptocurrencies for legitimate

* Yellen sidestepped questions on whether to raise the 20% tax rate for “pass-through” small businesses including sole proprietorships, saying the 2017 provision needed to be studied “to determine the extent to which it is helping to improve the prospects of America’s small business owners.”

WEALTH, CAPITAL GAINS TAXES:

* Yellen said Biden has not proposed a specific wealth tax but would “tax the investment income of families making more than $1 million at the same rate they pay on their wages and to tax some previously untaxed capital gains on the final return of wealthy taxpayers.

* Yellen said she would work with IRS and the Congress to focus enforcement activity on the largest sources of the gap between taxes owed and taxes aid.

TREASURY SECURITIES PORTFOLIO:

* Yellen said she would analyze the mix of debt securities now issued by the U.S.


Said she would analyze ways to strengthen support for the most vulnerable countries. “I look forward to studying the issue further and pledge to adhere to the legal requirement to consult with Congress before making a decision on the U.S. position on an SDR allocation.”

CARBON PRICING:

* Yellen said “we cannot solve the climate crisis without effective carbon pricing.”

* She reiterated her support for using financial regulation to combat risks from climate change, in response to a question asking her to commit not to do so.

* Yellen said she will advise Biden on achieving net-zero emissions no later than 2050 “based on the principle that polluters must bear the full cost of the carbon pollution they are emitting.”

THE DOLLAR AND CURRENCY MANIPULATION:

* Yellen reiterated her commitment to allow the dollar’s value to be determined by market forces.

By Reuters Staff

7 Min Read

WASHINGTON (Reuters) – U.S. Treasury nominee Janet Yellen underscored in writing on Thursday the Biden administration’s intent to remake tax and trade policy after conquering the coronavirus pandemic and making domestic investments in workers and infrastructure.

The Senate Finance Committee plans to consider her nomination for Treasury Secretary for 10 a.m. EST on Friday.

Following are some of Yellen’s written responses to additional questions from committee members, according to a copy of the responses obtained by Reuters:

STATE LOCAL TAX DEDUCTION:

* Yellen said it was critical to evaluate the effect of a 2017 cap on deductions of state and has on state and local governments and their residents.

President Biden’s pick to lead the United States Treasury Department, Dr. Janet Yellen thinks crypto has the potential to enhance the financial system and wants to encourage its legitimate use-cases.

President Joe Biden has nominated Janet Yellen as Secretary of the Treasury, and while her comments on cryptocurrency last week appeared to be negative—the former Federal Reserve chair has revealed that she sees great potential in the nascent digital asset class.

Yellen initially said that the US needs to examine how it can curtail the use of crypto for illicit financing which she explained was its main use during her Senate confirmation hearing last week, She made the comments in response to a question from Sen.

U.S. and international financial systems.

I think we need to look closely at how to encourage their use for legitimate activities while curtailing their use for malign and illegal activities. If confirmed, I intend to work closely with the Federal Reserve Board and the other federal banking and securities regulators on how to implement an effective regulatory framework for these and other fintech innovations.

It is clear from this answer that J. Yellen is not indifferent to cryptocurrencies and is interested in creating an effective regulatory framework.

So, if J. Yellen were elected as US treasury secretary, it could mean that, as a country, US would no longer be considered one of the worst places for crypto and fintech companies.

Recall only the recent outrage of CEO Coinbase, who publicly called on people to fight new crypto regulations from the U.S.

Finally, Rick Scott asks whether there are any tools that can protect and guide investors in their choices.

Janet Yellen’s position on cryptocurrencies

It is well known that the new US Treasury Secretary of the Biden era cannot be described as crypto-friendly. On the contrary, Janet Yellen, while recognizing the opportunities of the cryptocurrency sector, has expressed concern about the misuse of crypto.

Scams and fraud are only part of what concerns Janet Yellen. The other major concern is that cryptocurrencies are being used to finance terrorism, against which the US is fighting a historic battle.

It seems that in the four years of the Biden era there will be a way to regulate the sector, given the pressure that seems to be coming from many sides.

Treasury secretary Janet Yellen recently gave a relatively measured approach outlining her thoughts on digital currencies. In her written testimony, Yellensaid,

I think it important we consider the benefits of cryptocurrencies and other digitalassets, and the potential they have to improve the efficiency of the financial system. At thesame time, we know they can be used to finance terrorism, facilitate money laundering, andsupport malign activities that threaten U.S.
national security interests and the integrity ofthe U.S. and international financial systems. I think we need to look closely at how toencourage their use for legitimate activities while curtailing their use for malign and illegalactivities.

Janet Yellen that he is concerned about the risks and scams associated with cryptocurrencies. Firstly, he notes, their value has plummeted dramatically in recent weeks, while reports on scams and fraud show that cases are soaring.

Specifically, the FTC research is reported as saying that cryptocurrency scams cost taxpayers $80 million a year (Elon Musk’s name scams are worth $2 million), for an average loss of $1,900 per taxpayer.

That’s why the senator is calling on Janet Yellen to act to:

“protect consumers and legitimate investors from widespread cryptocurrency scams”.

He also asks how the US Treasury Department intends to take action to prevent and identify scams and fraud in the buying and selling of cryptocurrencies by US users.

The same letter also asks how the US defends itself against interference from states such as Russia and China.

If confirmed, I intend to work closely with the Federal Reserve Board and theother federal banking and securities regulators on how to implement an effective regulatoryframework for these and other fintech innovations.

The answer she provided in her written testimony is much more balanced than the answer she provided in her verbal testimony during her confirmation hearing, in which shesaid,

You’re absolutely right that the technologies to accomplish this change over time, and we need to make sure that our methods for dealing with these matters, with terrorist financing, change along with changing technology. Cryptocurrencies are a particular concern. I think many are used – at least in a transaction sense – mainly for illicit financing.

The world can be certain that the United States will not seek a weaker currency to gain competitive advantage.”

* She also committed to pressuring countries suspected of devaluing their currencies. “The Biden-Harris Administration will be examining how Treasury, Commerce and (the U.S. Trade Representative) can work together to put effective pressure on countries that are intervening in the foreign exchange market to gain a trade advantage.”

CRYPTOCURRENCIES:

* Yellen said she plans to work with other authorities for an approach to regulating bitcoin and other cryptocurrenices. “I think we need to look closely at how to encourage their use for legitimate activities while curtailing their use for malign and illegal activities.

At the same time, however, he emphasized that it is cryptocurrencies that provide an opportunity for various entities that want to bypass the financial system and undermine American interests.

The question was as follows:

Dr. Yellen, what do you view as the potential threats and benefits these innovations and technologies will have on U.S. national security? Do you think more needs to be done to ensure we have appropriate safeguards and regulations for digital and cryptocurrencies in place?

Answer:

I think it important we consider the benefits of cryptocurrencies and other digital assets, and the potential they have to improve the efficiency of the financial system. At the same time, we know they can be used to finance terrorism, facilitate money laundering, and support malign activities that threaten U.S.

Given my prior leadership at the Federal Reserve, I understand deeply why it is so important to maintain the tradition of the independence of the Fed in monetary policy. In areas where it will be appropriate and necessary for coordination between the Treasury and the Fed, I, if confirmed, will certainly take those responsibilities seriously and will be well-positioned to work seamlessly with Chairman Powell.”

* Yellen said the Fed’s Main Street Lending program and other expired coronavirus Fed 13(3) lending facilities will not be available. She did not commit to reviving them, saying she would work to ensuring that “additional support particularly gets to small, mid-size businesses that have been hardest hit during the crisis.”

UNEMPLOYMENT BENEFITS:

* Yellen said the COVID-19 pandemic has highlighted the need for U.S.

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