The U.S. government has no plans to regulate or legislatively legitimize cryptocurrencies anytime soon, a policy void that leaves Bitcoin speculators out in the cold for now.
At a recent security conference in Munich, White House and other government officials commented on the political, criminal, regulatory and public relations obstacles that prevent cryptocurrencies from becoming government-supported and regulated.
Rob Royce, a special assistant to President Trump and the White House cybersecurity coordinator, spoke at length at the conference about the unlikelihood of the U.S. government’s embrace of Bitcoin and other cryptocurrencies.
“I think we’re still absolutely studying and understanding what the good ideas and bad ideas in that space are. So I don’t think it’s close,” Joyce said.
“We haven’t figured that out yet, so it’s a problem.”
Joyce also touched on criminal use of Bitcoin, an issue recently echoed by Steve Mnuchin, the U.S. Treasury Secretary.
“We are worried. There are benefits to the Bitcoin concept — digital cash, digital currencies — but at the same time, if you look at the way Bitcoin works after there is a criminal act that takes place, you can’t rewind the clock and take back that currency,” said Joyce.
The conference had more than 450 heads of state, government policymakers and business executives on hand to discuss global policy and security concerns.
The future of Bitcoin, its potential for regulation and criminal use were among the key topics.
Critics of Bitcoin are alarmed by the fact that, as a digital currency, Bitcoin is decentralized.
Whereas fiat currencies are backed by governments, financial regulatory bodies and public trust, cryptocurrencies have no such backing. They are created wholly online.
Another worrisome problem for policymakers is the anonymous nature of Bitcoin creation, and the fact that the digital currency is not regulated by any country or authority.
Governments worry about the potential for Bitcoin to destabilize public trust in current global fiat currency infrastructure.
Another problem for potential Bitcoin financial regulation, in the United States or any other country, is how it might be enforced from country to country.
Some countries don’t recognize cryptocurrencies at all, others have modest restrictions and some prohibit cryptocurrency trading entirely.