Representatives Demand Housing Agency Halt Any Cryptocurrency Experiments

[Nevilledog]

https://www.propublica.org/article/hud-cryptocurrency-blockchain-democrats-maxine-waters

Three federal lawmakers are calling on the U.S. Department of Housing and Urban Development to stop any initiatives involving cryptocurrency and the blockchain, saying the scantly regulated technologies should be kept far away from the agency’s work overseeing the nation’s housing sector.

In a letter to HUD Secretary Scott Turner on Wednesday, Reps. Maxine Waters, Stephen Lynch and Emanuel Cleaver sharply criticized the agency for considering such experiments, given cryptocurrency’s volatility and vulnerability to fraud. The Democratic representatives, all members of the House Financial Services Committee, warned of repeating “the same mistakes of the past,” noting that the 2008 financial crisis was triggered in part by the proliferation of risky financial assets in the housing market.

“The federal government cannot allow under-regulated financial products to infiltrate critical housing programs, especially when they have already proven to be dangerous, speculative, and harmful to working families,” the lawmakers wrote.

The letter is a response to reporting by ProPublica that the housing agency recently discussed taking steps toward using cryptocurrency. The article described meetings in February in which officials discussed incorporating the blockchain — and possibly a type of cryptocurrency known as stablecoin — into the agency’s work. The discussion at one meeting centered on a pilot project involving one HUD grant, but a HUD finance official in attendance indicated the idea could be applied much more expansively across the agency.

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