Tags: Lew | Dimon | Bitcoin | unlawful

Lew Calls Bitcoin a Place to Hide, Shares Dimon's 'Incredulity'

Thursday, 23 January 2014 10:54 AM

The U.S. government needs more time to assess the Bitcoin “phenomenon” to ensure the virtual currency isn’t used for unlawful purposes, Treasury Secretary Jacob J. Lew said.

Lew, who leads the Obama administration’s efforts to fight illicit finance globally, said he discussed Bitcoin with JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon and shares a “certain incredulity” about it.

“We have to make sure it does not become an avenue to funding illegal activities or to funding activities that have malign purposes like terrorist activities,” Lew said in an interview with CNBC today at the World Economic Forum in Davos, Switzerland. “It is an anonymous form of transaction and it offers places for people to hide.”

Lew said the Treasury has “made it clear through enforcement actions that we will look at these forms of transaction and we will enforce all of the rules we have on illegal money activity.”

The price of Bitcoins soared in November, topping $1,000 for the first time, as speculators anticipated broader use of digital money. The price has since dropped to around $815 on Bitstamp, one of the more active online exchanges where Bitcoins are traded for dollars and other currencies. One Bitcoin cost about $15 a year ago.

Bitcoin was introduced in 2008 by a programmer, or group of programmers, going under the name of Satoshi Nakamoto. There are 21 million possible Bitcoins that can be mined by a peer-to-peer network harnessing computers to complete complicated mathematical calculations. About 12.2 million units are currently in circulation, according to Bitcoincharts.com.

Earlier, Dimon told CNBC that Bitcoin is a “terrible store of value.”

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The U.S. government needs more time to assess the Bitcoin "phenomenon" to ensure the virtual currency isn't used for unlawful purposes, Treasury Secretary Jacob J. Lew said.
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2014-54-23
Thursday, 23 January 2014 10:54 AM
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