After the recent judgment wherein a federal judge in Texas that adjudicated that Bitcoins are indeed a currency; therefore subject to government regulation, the U.S. Government is trying to regulate it. Reportedly, the Senate’s committee on homeland security has sent a letter to various major financial regulators in the country regarding the regulation of the virtual currency.
The Judgment that May Change the Way Authorities Look at Bitcoin
Earlier, in the landmark judgment, Judge Amos Mazzant in a case against Bitcoin Savings and Trust, a hedge fund that had raised at least 700,000 Bitcoin in BTCST investments, held that these were under the U.S. Security and Exchange Commission. He also concluded that Bitcoin is a currency.
From the judgment by Amos Mazzant in the case against Bitcoin Savings and Trust that Bitcoin can be used as money just like the U.S. dollar, Euro, Yen, and Yuan, there must be regulation for it too as are for these other currencies.
Now, it has to be seen what is in store for this virtual currency as the Senate has started showing its interest in it.
Regulation is Necessary, says Government Agency
Recently, the Senate’s committee on homeland security considers that Bitcoin may be used for online transactions that are not monitored by traditional financial institutions and for it; the body sent a letter to various financial regulators regarding this. However, it is not just Bitcoin that is facing the ire but all other similar currencies that are troubling the government.
The government of the country is all set to oversee what is going on in Bitcoin transactions which are prone for being used in contraband activities. They are also mulling plans to prevent criminals from using virtual currencies like Bitcoin for nefarious ends and in this regard the letters of intentions have been sent to various financial regulators.
The organizations that have been intimated by the Senate committee include: Commodities Futures Trading Commission, the Department of Treasury, the Federal Reserve, the Office of Management and Budget, the Securities and Exchange Commission, the Department of Homeland Security, and the Department of Justice.
The letter that the Senate committee sent indicates that virtual currencies can be sent nearly anonymously, leaving little or no trail for regulators or enforcement agencies and their near anonymous and decentralized nature has also attracted criminals who value few things more than being allowed to operate in the shadows.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org