Speaking at the World Economic Forum in Davos, Switzerland last month, United States Treasury Secretary Jack Lew warned that regulations of bitcoin (BTC) could be instituted by the federal government soon. Lew argued that authorities cannot permit bitcoin to become a tool to fund illegal activities and illicit transactions.
In an interview with CNN Chief Business Correspondent Christine Romans on Wednesday, Lew discussed an array of economic and public policies and news, such as the minimum wage, immigration reform and the debt ceiling. However, one particular part of the interview is generating buzz among the bitcoin community.
Lew essentially warned that the era of unregulated digital currencies is coming to an end. The Treasury Secretary didn’t condemn the virtual currency, but noted that the innovation in bitcoin must be balanced with legal elements.
“As a policy matter, what we have to look at across all the different forms of payment is that the same rules apply, it’s a level playing field,” he said. “Just as with cash or checks, if there’s virtual currency or online payment methods, they’ll have to comply with all the same laws that everybody else complies with. It’s not going to be ok to do elicit activity, whatever form of currency you’re using.”
His comments come as bitcoin has experienced setbacks in the past two weeks. In particular, the Tokyo-based Mt. Gox exchange platform has suspended its withdrawals and the price on the company website has fallen to $162 – compared to just under $600 on the market. Many are speculating that Mt Gox could very well be insolvent.
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