Sen. Joe Manchin is urging federal regulators to ban Bitcoin amid turmoil surrounding the virtual currency.
Manchin, D-W.Va., said in a press release that he has sent a letter to Treasury Secretary Jack Lew, Federal Reserve Chair Janet Yellen and other officials urging them to bar the use of Bitcoin in the U.S., calling it “unstable and disruptive to our economy.”
Manchin’s call comes a day after Bitcoin was dealt a major blow when one of its major exchanges, Mt. Gox, went bust after secretly racking up catastrophic losses. The virtual currency, which started in 2009, allows people to make one-to-one transactions, buy goods and services and exchange money across borders without involving banks, credit card issuers or other third parties.
Bitcoins themselves are basically lines of computer code that are digitally signed each time they travel from one owner to the next.
Though Bitcoin is beloved by an eclectic group of die-hard fans, it has also struggled to shake an association with illicit and criminal behavior. One notable example is its role in powering the now-defunct online drug marketplace Silk Road.
Manchin says Bitcoin has proven to be dangerous, saying the currency is susceptible to hackers and scam artists and makes it too easy for people to purchase illegal drugs or weapons online.
“The very features that make Bitcoin attractive to some also attract criminals who are able to disguise their actions from law enforcement,” he said.
Manchin also says the volatile currency could be detrimental to the U.S. economy, saying American consumers stand to lose if Bitcoin’s value follows current trends.
“As of December 2013, the Consumer Price Index (CPI) shows 1.3% inflation, while a recent media report indicated Bitcoin CPI has 98% deflation,” Manchin said. “In other words, spending Bitcoin now will cost you many orders of wealth in the future. This flaw makes Bitcoin’s value to the U.S. economy suspect, if not outright detrimental.”
The Associated Press contributed to this report.