The U.S. Treasury stated that private cryptos are a threat to government power. The deputy secretary of the U.S. Treasury, has discussed the possibility of a not so distant future where private digital cryptocurrencies have gained strength, stripping some of the power away from the government’s monetary policies.

During a keynote address at Bank Policy Institute Annual Conference in New York on Thursday, The deputy secretary of Treasury gave an overview on the Treasury’s most urgent priorities. He spoke about many subjects from regulatory and tax reform to economic policy and national security.

As well as devoting a good portion of his speech to the crypto space, and the growing trend of non-bank companies providing financial and monetary services.

“Cryptocurrency projects not only have implications for private business, but also for a number of activities the government is responsible for.”

There are a number of potential threats that could arise from crypto technology, he said. Including national security, treasury monetary bases, financial stability, along with privacy and consumer protections.

The Treasury is concerned that digital currencies “can potentially be used to evade existing legal frameworks – like those governing taxation, anti-money laundering, and countering the financing of terrorism,”. The treasury has yet to set out that U.S. laws must be obeyed, whether a transaction is made with fiat or digital currency. If an anonymous crypto should grow to scale, it will become drastically harder to enforce those laws.

Even if cryptocurrency projects intend to comply with all anti-money laundering rules, there’s still a threat to user protection and financial stability. If one grew to be used on a large scale, who would make the big decisions on any important changes? What if a majority of the crypto was owned outside the U.S.?

“In any case, would important decisions about our economic system have been taken out of the hands of representatives accountable to the people?” he asked.

His finishing statements were a warning to the crypto industry. The deputy secretary announced that policymakers “in pursuing the public interest, will take a very hard look at these issues.”

