February 26, 2014 Dear Secretary Lew, Chairwoman Yellen, Commissioner Curry, Acting Chairman et!

en, Chairman "ruenberg, Chairwoman hite# $ write to%ay to e&'ress my concerns about ()* +,S, D-LLA./0itcoin1, (his /2irtual1 currency is currently .*"+LA(*D /unregulate%1 an% .*"A.DL*SS -F ()$S FAC( has allowe% users to 'artici'ate in illicit acti2ity, while also being highly unstable an% %isru'ti2e to our economy )*3 4$* *D F.-5 ()* -.LD S(A"*, For the reasons outline% below, $ urge regulators to ta6e a''ro'riate action to limit the abilities o7 this )$")LY DA3"*.-+S/highly unstable1 currency, 0y way o7 bac6groun%, /0itcoin is a cry'to8currency that has gaine% notoriety in recent months1 ()* +,S, D-LLA. $S A F$A( C+..*3CY ()A( )AS "A$3*D 3-(-.$*(Y -4*. 5A3Y Y*A.S %ue to its rising e&change 2alue an% relation to illegal transactions, *ach +,S, D-LLA./0itcoin1 is %e7ine% by +3$9+* S*.$AL 3+50*./a 'ublic a%%ress an% a 'ri2ate 6ey1, thus ()* +,S, D-LLA./0itcoin1 is not only a to6en o7 2alue but also a metho% 7or trans7erring that 2alue, $t also means that ()* +,S, D-LLA. )AS 3- (.AC*A0L* F$3"*.:.$3(/0itcoin 'ro2i%es a uni;ue %igital 7inger'rint1, which allows 7or anonymous an% irre2ersible transactions, (he 2ery 7eatures that ma6e ()* +,S, D-LLA./0itcoin1 attracti2e to some also attract criminals who are able to %isguise their actions 7rom law en7orcement, Due to ()* +,S, D-LLA.<S/0itcoin=s1 anonymity, the /2irtual1 mar6et has been e&tremely susce'tible to ()$*4*S/hac6ers1 an% scam artists stealing millions 7rom +,S, D-LLA./0itcoins1 users, Anonymity combine% with ()* +,S, D-LLA.<S/0itcoin=s1 ability to 7inali>e transactions ;uic6ly, ma6es it 2ery %i77icult, i7 not im'ossible, to re2erse 7rau%ulent transactions, ()* +,S, D-LLA./0itcoin1 has also become a ha2en 7or in%i2i%uals to buy blac6 mar6et items, $n%i2i%uals are able to anonymously 'urchase items such as %rugs an% wea'ons illegally, $ ha2e alrea%y written to regulators once on the now8close% C-.3*. D.+" D*AL*./Sil6roa%1, which o'erate% 7or years in su''lying %rugs an% other blac6 mar6et items to criminals, than6s in large 'art to the creation o7 ()* +,S, D-LLA./0itcoin1, (hat is why more than a han%7ul o7 countries, an% their ban6ing systems, ha2e cautione% against the use o7 /0itcoin1, $n%ee%, it has been banne% in -3* C-+3(.Y 8 A."*3($3A/two %i77erent countries?(hailan% an% China?an% South @orea1 A3D .+SS$A state% that it will not recogni>e ()* +,S,

D-LLA./0itcoin1 as a legitimate currency 0+( AS A :-3A$ SC)*5*, Se2eral other countries/, inclu%ing the *uro'ean +nion,1 ha2e issue% warnings to +,S, D-LLA. /0itcoin1 users as their res'ecti2e go2ernments consi%er o'tions 7or regulating or banning its use entirely, hile it is %isa''ointing that the worl% lea%er an% e'icenter o7 the ban6ing in%ustry will only 7ollow suit instea% o7 ma6ing 'olicy, it is high time that the +nite% States hee% our allies= warnings, $ am most concerne% that as ()* +,S, D-LLA./0itcoin1 is ine2itably banne% in other countries, Americans will be le7t hol%ing the bag on a 2alueless currency, -ur 7oreign counter'arts ha2e alrea%y un%erstoo% the wi%e range o7 'roblems e2en with ()* +,S, D-LLA.<S/0itcoin=s1 legitimate uses 8 7rom its signi7icant 'rice 7luctuations to its %e7lationary nature, /Bust last wee6, 0itcoin 'rices 'lunge% a7ter the currency=s ma!or e&change, 5t, "o&, e&'erience% technical issues, (wo %ays ago, this e&change too6 its website %own an% is no longer e2en accessible, (his was not a uni;ue e2entC news o7 'lummeting or s6yroc6eting 0itcoin 'rices is almost a wee6ly occurrence, $n a%%ition, its %e7lationary tren%s ensure that only s'eculators, such as so8calle% D0itcoin miners,E will bene7it 7rom 'ossessing the 2irtual currency, (here is no %oubt a2erage American consumers stan% to lose by transacting in 0itcoin, As o7 December 201F, the Consumer :rice $n%e& GC:$H shows 1,FI in7lation, while a recent me%ia re'ort in%icate% 0itcoin C:$ has JKI %e7lation, $n other wor%s, s'en%ing 0itcoin now will cost you many or%ers o7 wealth in the 7uture, (his 7law ma6es 0itcoin=s 2alue to the +,S, economy sus'ect, i7 not outright %etrimental,1 [PARAGRAPH REDACTED DUE TO SHORTSIGHTED SPECULATION ON AN EMERGING MARKET, THE TIMEFRAME IS TO NARROW TO OFFER AN ACCURATE ASSESMENT] (he clear en%s o7 ()* +,S, D-LLA./0itcoin1 7or either transacting in illegal goo%s an% ser2ices or s'eculati2e gambling ma6e me weary o7 its use, /(he Senate )omelan% Security an% "o2ernmental A77airs Committee issue% a re'ort !ust this month stating, D(here is wi%es'rea% concern about the 0itcoin system=s 'ossible im'act on national currencies, its 'otential 7or criminal misuse, an% the im'lications o7 its use 7or ta&ation,E1 0e7ore the +,S, gets too 7ar behin% the cur2e on this im'ortant to'ic, $ urge the regulators to wor6 together, act ;uic6ly, an% 'rohibit this %angerous currency 7rom F+.()*. harming har%8wor6ing Americans, Sincerely, +,S, Boe 5anchin $$$ +nite% States Senator