FED: “We have no authority to regulate Bitcoin”

Fed Chair Janet Yellen says that Bitcoin is out of her reach

By John Vibes

WASHINGTON (INTELLIHUB) — This week West Virginia Senator Joe Manchin formally asked the Federal Reserve to regulate Bitcoin, and the response from Fed Chair Janet Yellen was fairly surprising.

“Bitcoin is a payment innovation that’s taking place outside the banking industry. To the best of my knowledge there’s no intersection at all, in any way, between Bitcoin and banks that the Federal Reserve has the ability to supervise and regulate. So the fed doesn’t have authority to supervise or regulate Bitcoin in anyway.”  She said, adding that, “One concern with Bitcoin is the potential for money laundering. [FinCen] has indicated their money laundering statutes are adequate to meet enforcement needs.”

Manchin asked whether U.S. was “behind the curve” among countries issuing warnings on or regulating Bitcoin, and Yellen responded by saying that “The Fed doesn’t have authority with respect to Bitcoin,” she responded. “But certainly it would be appropriate for Congress to ask questions about what the right legal structure would be for digital currencies…My understanding is Bitcoin doesn’t touch [U.S.] banks.”

“It’s not so easy to regulate Bitcoin because there’s no central issuer or network operator. This is a decentralized, global [entity],” she concluded.

Bitcoin has experienced a great deal of uncertainty recently, with millions being stolen from MTGOX, the most popular Bitcoin exchange.

A statement posted yesterday on the Mt. Gox website attributed to Karpeles said he is “still in Japan” working to resolve the exchange’s problems. The exchange’s staff has been instructed “not to give any response or information,” according to the statement.

Writer Bio:

(Photo: Intellihub.com)

John Vibes is an investigative journalist, staff writer and editor for Intellihub News where this article originally appeared. He is also the author of an 87 chapter e-book entitled “Alchemy of this Modern Renaissance” and is an artist with an established record label. You can find him on his Facebook.
For media inquires, interviews, questions or suggestions for this author, email: vibes@intellihub.com or telephone: (347) 759-6075.
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