Govt finds risks associated with unhosted crypto wallets, says US Treasury official

The United States Treasury deputy secretary shared his stance on the crypto & blockchain industry and pointed out possible risks associated with unhosted crypto wallets. 

Crypto & blockchain technology adoption is going on continuously and these things are happening at a high rate because of huge numbers of beneficial facts like modernization in the payment system, Security & trust of the data under the decentralised medium and many practical applications in real-life in the tech industry. Opposite to the crypto adoption, there are many reasons to keep the crypto industry under the restricted regulated framework. 

Recently Wally Adeyemo, Deputy Secretary at US Treasury, shared his stance and the ongoing activities among the government agencies regarding cryptocurrencies, during the 2022  Consensus conference, which was held on 10 June.

Wally said that financial institutions and firms should be aware of the risks associated with cryptocurrency-related transactions, which include many illegal activities or cause the promotion of illegal funding methods anonymously.

Wally said that government agencies are aware of the risks associated with it and also they are working to uphold the sector’s innovative nature. 

“We are working to address the unique risks associated with unhosted wallets. Because unhosted wallets are effectively managed on a blockchain, it can be challenging to determine who owns and controls them—creating opportunities to abuse this heightened anonymity.”

The US Treasury Secretary official also said that the government is mainly focusing on the regulation-based works to ensure the revolution of the financial system with this digital industry.

Unhosted crypto wallet

Wally noted that increasing the use of unhosted crypto wallets is a big concern for government agencies because this can result in the promotion of crypto use in illegal activities.

Wally said that the matter of unhosted wallet and their use against the laws came to light because of the Russia vs Ukraine conflict, where experts claimed that Russia may use cryptocurrencies against the international financial trade ban.

In the end, Wally said that regulation on the crypto & blockchain industry is going on to keep the innovation upside at the same time to keep illegal activities away because Cryptocurrencies are national security risks in the unregulated region.

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