Janet Yellen, Sounding More Constructive, Acknowledges Crypto's Role in Finance

U.S. Treasury Secretary Janet Yellen acknowledged crypto’s growing role in American finance during an interview Friday, and said she will work towards creating a regulatory environment conducive towards continued innovation.

• “There have been benefits from crypto and we recognize that innovation in the payment system can be a healthy thing,” she told CNBC. “We would like to come out eventually with recommendations that will create a regulatory environment [for] innovation."
• Yellen was known for being an outspoken critic of bitcoin (BTC) and the broader cryptocurrency space during her time as Federal Reserve chair, and then as a private citizen when she stated, in 2018, she was "not a fan" of bitcoin.
• Now that she is Treasury secretary, Yellen said she now has only “a little bit of skepticism,” noting concerns about financial stability, consumer investor protection and crypto’s use for illicit transactions.
• Yellen’s more constructive comments follow the Biden Administration’s executive order earlier this month calling for a “whole-of-government” approach to regulating crypto, which acknowledged the need to promote the important innovation that might come from the sector.
• "Crypto has obviously grown by leaps and bounds," she told CNBC, "and it's now playing a significant role … in [the] investment decisions of lots of Americans.”