Bitcoin jumps after apparent Yellen statement quells US clampdown fears

Bitcoin led a rally in cryptocurrencies on Wednesday after what appeared to be a prematurely published US Treasury statement allayed market worries about a sudden tightening of US rules around digital assets.

In a statement that briefly appeared on the Treasury website before it was taken down, Treasury Secretary Janet Yellen said a still-pending executive order on virtual currencies from President Joe Biden “calls for a coordinated and comprehensive approach to digital asset policy (that) will support responsible innovation.” CoinDesk carried an archived version of the release.

The US Treasury Department did not immediately respond to Reuters’ emailed request for comment about the statement outside of business hours.

Biden is expected to sign a long-awaited executive order this week directing the Justice Department, Treasury and other agencies to study the legal and economic ramifications of creating a US central bank digital currency, a source familiar with the matter said on Monday.

The White House last year said it was considering a wide-ranging oversight of the cryptocurrency market – including an executive order – to deal with the growing threat of ransomware and other cybercrime.

The statement “seems to indicate that (US authorities) won’t be taking any swift, major regulatory actions as yet, and will likely be taking a more coordinated and objective approach over time,” leading cryptocurrencies to rally, said Matthew Dibb, COO of Singapore crypto platform Stack Funds.

Bitcoin climbed 7.2 per cent to $41,515, on track for its biggest gain since Feb. 28, while smaller peer ether added 5.3 per cent to $2,715, also set for its best day this month.