Treasury Secretary Mnuchin wants to keep cryptocurrencies away from 'bad guys'

Key Points
  • Treasury Secretary Steven Mnuchin says he does not see bitcoin and its competitors as a threat to financial stability.
  • Speaking to the Senate Banking Committee, Mnuchin says he wants to make sure bitcoin and its peers are "not used by bad guys."

Treasury Secretary Steven Mnuchin said Tuesday the department is monitoring cryptocurrency developments, with particular attention to its use by criminals.

Speaking at a hearing before the Senate Banking Committee, he said he does not see bitcoin and its competitors as a threat to financial stability, though he does have other concerns.

"I want to make sure that these are not used by bad guys, that they don't turn into Swiss numbered bank accounts," Mnuchin said. He later added: "We want to make sure consumers understand the issues surrounding cryptocurrencies."

Bitcoin specifically has seen violent swings in price lately, trading around $20,000 in mid-December before tumbling. It was at $10,370 shortly after noon Tuesday. The largest of the cryptos, bitcoin has a market cap of $176.6 billion. In all, 32 digital currencies have market caps above $1 billion.

Mnuchin said anyone dealing with cryptocurrencies operates under the same money-laundering rules as banks.

Cryptos have been rife with fraud, with scammers using a number of devices to cheat buyers. They also are popular in black market activities.

WATCH: Strategist discusses the various ways bitcoin is used and stored.

Nick Colas of Datatrek on bitcoin and cryptocurreny wallets