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Source: Сointеlеgrаph

Alternative non-cryptocurrency payment systems pose a serious threat to the security of the United States, according to testimony presented Tuesday at a subcommittee hearing on national security, international development, and monetary policy of the U.S. House of Representatives Committee on Financial Services. According to the speakers, the ecosystem of alternative payments should be considered as a whole, and cryptocurrency can increase national security.

Wilson Center staffer Scott Deweck told the U.S. House of Representatives Financial Services Subcommittee in an affidavit: “By focusing only on cryptocurrencies, we risk missing the forest for the trees.”

Money service businesses are highly regulated in the United States, but those outside the country may not wish to comply with US requirements, including Know Your Customer/Anti-Money Laundering, and may not comply with reporting requirements USA and other Western countries. Duveke said.

Duecke recommended intensifying efforts to collect financial information from open sources as a means of countering the threat posed by alternatives to the SWIFT network created by Russia and China and other threats. He said:

“The US must follow the global technology leadership of our private sector by setting the APE standards on the international stage. No matter which direction the US government takes regarding the digital dollar, […] she can’t wait to start interacting with the world through international organizations.”

While political goals inspire moves such as the formation of projects such as Russia’s financial messaging system, an alternative to SWIFT, and the country’s MIR banking card system, Duecke said poverty is a major factor in the expansion of the alternative payment ecosystem.

Duecke said that more than 700 million people are not adequately banked, and the situation is exacerbated by risk reduction practices when Western banks stop providing correspondent services to banks in poor regions. While safety is the government’s motivation for this practice, Duecke says there is often a profit motive behind it.

Related: Global Inflation Rising: How Stablecoins Help Protect Savings

Ari Redbord, head of legal and government affairs at TRM Labs, said at the hearing that US dollar-backed stablecoins can enhance US national security. Due to the prestige and reliability of US fiat currency, according to Redbord:

“One can imagine a world in which entrepreneurs create financial services products using a stablecoin backed by the US dollar, even if these products otherwise have little to do with the United States.”

Source: Сointеlеgrаph

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