Treasury Chief Janet Yellen Sees Holes in The Current System 

Cryptocurrency market is certainly going through a rough patch. From giant craterings to wavering regulations, happy days appear to have abandoned the industry for quite a while now. Now a recent statement by Janet Yellen, the U.S. Treasury chief, does not appear very empathic for the industry.

Janet Yellen Would Like To See Additional Legislation Passed

While appearing in an interview with CNBC, an America-based business news website, Janet Yellen expressed her support to regulate the cryptosphere. She explained the Treasury identified risks associated with the sector during their contributions towards Biden Administration’s Executive Order 14067 in March 2022.

The Treasury head said she “sees some holes in the current system.” Adding that, she is very supportive of agencies trying to regulate the sector and would like to work with Congress to see additional legislation passed. On Tuesday, Securities and Exchange Commission (SEC), the U.S. regulatory watchdog, alleged Coinbase of operating as an unregistered broker.

Moreover, the agency is going after major crypto exchanges while keeping several altcoins on its crosshair. Consequently, the market started declining with crypto assets experiencing a downfall as low as 15%. The SEC addressed virtual currencies including Solana (SOL), Cardano (ADA), Cosmos (ATOM) and more as securities.

Metaverse tokens including Deccentraland (MANA), The Sandbox (SAND), Axie Infinity (AXS) and more lost nearly 10% of their value. Trade volume in the sector skyrocketed to almost 70%, indicating panic sell-offs in the market. Additionally, the industry lost over 8% in a day. Currently, the digital world racket sits atop a $12 Billion market cap.

Regulators Are Still Skeptical About Crypto Sector

The global regulatory scenario is currently divided among crypto skeptics and favored regulations. The former are going full force to take the leash in their hands, while the latter wants the sector be treated as a regulated financial service. Today, El Salvador and the Central African Republic (CAR) remain the only crypto-friendly nations to accept Bitcoin (BTC) as a legal tender. Recently, El Salvador partnered with USDT stablecoin issuer, Tether for sustainable Bitcoin mining.

Stablecoins being the ultimate saviors from a volatile crypto market, too, are losing investors’ faith after the LUNA ecosystem crumbled. The Silicon Valley Bank collapse was a big despondent. USD Coin (USDC), the second-largest stablecoin, had nearly 3 Billions with the start-up friendly bank. The event caused it to lose its peg with the United States Dollar (USD) temporarily. Its market cap slipped from around $42 Billion in March to $28 Billion today.

According to Forbes, CEO of USDC stablecoin issuer Circle, Jeremy Allair, has emphasized the government to provide clear regulations. He said, “The banks can’t get involved in this because they’re not authorized, there’s no clear path, and they can’t hold stablecoins on their balance sheets because there’s no way for them to do that under the current rules. So this will actually increase bank adoption of USDC.”

Regulators are still skeptical about the sector. Group of 20 (G20) and Group of Seven (G7) are yet to arrive at a consensus. While G20 nations are calling for tighter restrictions on the cryptosphere, G7 countries are more inclined over regulating them to bring the best out of them.

Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.