Former US Treasury Secretary and World Bank Chief Economist Larry Summers says cryptocurrency will be better regulated in a robust way rather than treated as a libertarian paradise.
Larry Summers Sees Cryptocurrencies Benefitting From Strong Regulation
Lawrence Summers, who served as Secretary of the Treasury in the Clinton administration and director of the White House National Economic Council in the Obama administration, spoke about cryptocurrency regulation during an interview with Bloomberg on Friday. Summers, a former chief economist at the World Bank, is currently president emeritus of Harvard University.
He was asked why regulators around the world are “deeply skeptical” about cryptocurrencies. China, for example, has been breaking about crypto activities. Summers began by stating that the word “crypto” suggests a “desire to be secretive regarding large financial sums,” and explained:
When you have large financial sums happening in secret, you have risks of money laundering, risks of supporting various types of criminal activities, risks of scamming innocent people.
“The truth is that we would not have a viable airline industry if we were not regulating airline safety,” he continued. “We wouldn’t have the transportation system that we have if we don’t regulate car safety.”
He added that the blockchain-based payments industry “is going to be better regulated in a robust way, rather than trying to be some kind of libertarian paradise,” noting:
I think the crypto community should recognize that and should work in cooperation with governments and if they do. I think this innovation may be one of the important innovations of this period.
The former IMF chief economist pointed out that some people believe in the idea that cryptocurrency “is going to be a kind of libertarian paradise where we are not going to be able to enforce banking rules, like knowing your customers.” [KYC], where we will be able to move money freely and avoid paying taxes ”.
Summers opined: “I think this is a recognition that all industries that are systemic in their importance should come to,” adding:
It is not entirely different from the discussion of the big tech companies. They need to have a regulatory framework. They not only need it to protect their consumers, they need it to protect themselves.
In conclusion, he said, “We wouldn’t have the New York Stock Exchange as the center of the world’s stock market if we didn’t have a strong SEC,” emphasizing: “Even if people didn’t like the rules, some of the time . “
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