The U.S. Treasury Department plans to address Congress on the emerging problems that cryptocurrencies pose to current financial regulations.
Brian Nelson, Under Secretary of the Treasury for Terrorism and Financial Intelligence, was preparing testimony for the House of Representatives Committee on Financial Services. He planned to detail the agency’s concerns about the use of virtual assets in illegal financial activities.
Nelson said: “Treasury is deeply concerned about the use of virtual assets for any illicit financial activity.” “We have been working for more than a decade to implement an AML/CFT framework for digital assets that mitigates the risk of illicit finance while promoting responsible innovation.”
Nelson added that the Terrorism and Financial Intelligence Unit is watching the evolving strategies and technologies used by illicit groups to raise and transfer funds.
“While we continue to assess that terrorists’ use of digital assets remains a small fraction of the more established mechanisms for transferring money. We know that terrorist groups have used digital resources to collect, transfer and store illicit proceeds, and may continue to do so.”
Nelson paid particular attention to Hamas-related activities, saying: “For example, our recent multilateral action against several Hamas fund transfer networks that relied on several key exchanges to transfer income to the group.”
The crypto community discussed the Digital Asset Anti-Money Laundering Act of 2023 (DAAMLA) bill introduced by U.S. Senator Elizabeth Warren.
The bill, which received the support of 19 other senators as co-sponsors, aimed to strengthen the laws on the use of digital assets in illicit finance. This is the second time the Blockchain Association has approached lawmakers. It expressed this in a letter to the House of Representatives Committee on Financial Services and the Senate Banking Committee.
The association said that the Anti-Defamation Anti-Money Laundering Act(DAAMLA) threatens the strategic advantage of the United States, tens of thousands of jobs and has little impact on the illegal entities it targets. They added that Warren’s allegations missed the essence of their claims and wrongly questioned the motivations of many US Army and intelligence veterans who participated in the discussion.
