US Treasury Secretary Steven Mnuchin said the federal government is concerned about the use of bitcoin in illicit markets on the deep web.
In an interview with Yahoo Finance, Mnuchin said that bitcoin is on the Treasury Department’s radar and that he talks to regulators around the world about the right approach to ensure that it is not used to make “illicit fund transfers.”
“It’s something we’re looking at very carefully and we’ll continue to look,” Mnuchin said. “The first and most important issue is to ensure that people can not use bitcoins for illicit activities. So we want to make sure you do not have the deep web funded by bitcoins. And that is our concern today.”
He emphasized that although the Treasury does not have a specific timetable for the announcement of an official position on the regulation of cryptomoedas, the department has established working groups that are actively working on the cryptomoedas.
“And again [bitcoin is] something we will be watching very carefully,” he said.
The Treasury is one of many US regulatory agencies that are starting to take a more active role in regulating the crypto markets. The Securities and Exchange Commission (SEC) has publicly stated its concerns about the initial currency offerings (ICOs) , many of which say they may violate federal securities laws. Similarly, the SEC warned that celebrity endorsements to ICOs may be illegal in some cases if the token is subsequently determined as an asset.
The meteoric rally of this year’s bitcoin price, however, has caught the attention of the Internal Revenue Service, the US Internal Revenue Service, which states that very few people are reporting investment income related to crypto-coins in their tax returns. Earlier this year a report revealed that the agency paid a blockchain tracking company to help them track and identify tax fraud.