In order to prevent virtual currencies from being used for terrorist financing, the US Department of the Treasury is seeking greater enforcement powers from Congress to combat foreign institutions that provide cryptocurrency services, including seeking more authority to sanction overseas cryptocurrency platforms.
According to Bloomberg’s report today, Adewale O. Adeyemo, Deputy Secretary of the US Department of the Treasury, stated in written testimony provided before the Senate hearing on Tuesday that the current problem the US faces is that criminals are constantly seeking new ways to hide their identities and transfer resources using virtual currencies. Adewale O. Adeyemo mentioned that malicious actors like terrorists often “seek new ways to transfer their resources” because the US is taking action to cut off their ties to the traditional financial system.
According to Adewale O. Adeyemo, in the past year, radical organizations such as Hamas and the Palestinian Islamic Jihad in the Gaza Strip have received encrypted currencies from the Iranian Quds Force, and the US Department of the Treasury has taken action against networks that assist Hamas in obtaining smaller donations. He also mentioned that North Korea and Russia are among the countries that are increasingly using digital assets.
Adewale O. Adeyemo seeks congressional approval for a secondary sanction tool targeting foreign digital asset providers to prevent these providers from facilitating illegal financial activities. The US Department of the Treasury also hopes to explicitly expand its coverage to include key digital asset participants, such as cryptocurrency exchanges. The department requests authorization to take action against overseas cryptocurrency platforms that use the US financial system while endangering US national security.
Adewale O. Adeyemo said, “Which exchange will be the next target? Binance reached a settlement with the US Department of Justice (DOJ), the Commodity Futures Trading Commission (CFTC), the Office of Foreign Assets Control (OFAC), and the Financial Crimes Enforcement Network (FinCEN) and agreed to pay a huge settlement of $4.3 billion to continue its operations. At the end of March, another well-known cryptocurrency exchange, KuCoin, and its founders Chun Gan and Ke Tang were formally indicted by the Southern District of New York for violating US anti-money laundering regulations and engaging in unauthorized money transmission business.”
The market is closely watching who will be the next target under US regulation and whether it will have a negative impact on the market.
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