Biden Administration is reviewing the prevailing cryptocurrency rules to fill in the gaps and protect investors.
It is on the backdrop of high volatility in the market involving cryptocurrencies recently. The administration expects to frame new rules to govern crypto.
According to a communiqué to The Washington Post, the white house officials would check whether terrorists could use cryptocurrencies like bitcoin (BTC) for their financing.
They would also implement additional measures to safeguard small investors from heavy fluctuations in digital assets.
Panic selling in Bitcoin
Bitcoin drop below $30,000 caused panic selling. As a result, digital assets lost more than $1 trillion in value in a matter of ten days.
The value of digital assets almost halved during mid-April 2021 and mid-May 2021.
The US treasury mandates reporting transactions over $10,000
The US treasury framed a new rule to keep a check on cryptocurrency transactions. According to the new law, the investors need to report all the transactions above $10,000 to IRS (Internal Revenue Agency).
Plans to strengthen IRS
The bidden administration expects to double the workforce in the IRS in the next ten years. According to a claim of Washington Post citing federal lawmakers, wider variations in cryptocurrency rates would not affect the broader stability of the financial markets. However, stringent measures are necessary to mitigate the risks in crypto.
The value of the cryptocurrency market is more than $2.5 trillion at its peak. However, it is minor compared to the broader financial system worldwide. The risks may increase in the future as the market for crypto grows. It mandates stricter measures to protect investors.
Bitcoin traded at $37,329.93 on June 3, 2021, and maintains dominance of 41.6%. The market cap of global cryptocurrency is $1.68 trillion, surged by 4.3% compared to the previous day.
The total volume of the crypto market is $109.18 billion in the past 24 hours.
India to set up new rules
The unregulated crypto industry in India is subjected to self-regulation. The mobile and internet association establishes a committee to resolve issues by applying best practices in crypto.
The Blockchain and CAC (Crypto Assets Council) would include fintech compliance specialists, technical specialists, and advocates to implement self-regulation. India legalized Crypto exchange business activity.