US Senators Deem Iranian Crypto Mining a National Security Threat

Senators Elizabeth Warren and Angus King urged the administration of President Joe Biden to provide information on measures to combat Iran’s “unbridled evasion” of sanctions through cryptocurrency mining.

“Iran legalized the digital asset mining industry in 2019. Over the past five years, Iran has earned millions of dollars from mining—a stable source of income that allows for the purchase of imported goods, the transfer of funds domestically and abroad, and the financing of Hamas and other terrorist organizations,” the letter states.

The authors believe that cryptocurrency mining activities threaten national security. Warren and King also described Iran as “one of the world’s largest producers of Bitcoin.”

They added that authorities also use digital assets for money laundering. The letter mentions Binance, which “processed Iranian crypto transactions worth $8 billion over a four-year period.”

Warren and King seek to better understand the extent of Iran’s use of mining to evade sanctions and finance terrorism. They demanded that the administration by May 16:

• provide data on the income of cryptocurrency miners in Iran since 2021;
• information on the use of digital assets and their connection to the Iranian government;
• steps to mitigate threats to national security.

Previously, Warren stated that cryptocurrency aids rogue states, terrorists, and criminal organizations. In April, she expressed concern over the use of digital assets to circumvent economic restrictions.

In the same month, the US Treasury sought additional ways to monitor compliance with secondary sanctions. Officials also called for legislation to expand the department’s role in the “digital asset ecosystem” and rules addressing jurisdictional issues for regulating foreign companies in the industry.

In May 2024, it was reported that Russia and Iran are exploring the use of digital financial assets and CBDCs in mutual settlements.