Government must have power to reverse crypto transactions, says co-chair of blockchain caucus – MarketWatch

Government must have power to reverse crypto transactions, says co-chair of blockchain caucus – MarketWatch

Many in the cryptocurrency industry have long demanded that Congress provide “regulatory clarity” on how it will tax and regulate digital assets. But as powerful figures in Washington weigh in, it’s doubtful crypto enthusiasts are liking what they hear.

Democratic Rep. Bill Foster of Illinois, co-chair of the House blockchain caucus, said Tuesday that laws must be passed to allow federal courts to identify digital-asset holders and then reverse transactions in bitcoin BTCUSD, -0.94% or other digital currencies, a policy that is anathema to many cryptocurrency investors.

“You have to be able to go to a court to unmask participants under some circumstances,” Foster said during an Axios virtual event Tuesday, adding that cryptocurrencies must be “pseudo anonymous, so the regulators can see” if transactions on the network are fraudulent.

Different cryptocurrencies exist on a continuum of anonymity. Bitcoin, for instance, is largely anonymous even as every transaction on the network is public for anyone to investigate. However, there are methods of discovering someone’s real-world identity by studying this transaction history and searching the internet for instances when a bitcoin user may have accidentally linked their bitcoin wallet address with personal information. It’s possible, for example, for a
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