US Treasury Seeks to Regulate Foreign Bitcoin Exchanges

The US Treasury is advocating for an expansion of its powers to enhance oversight of cryptocurrency service providers, including foreign entities. This was stated by Deputy Secretary Adewale O. Adeyemo ahead of Senate hearings.

According to him, malicious actors are constantly “seeking new ways to conceal identities and move assets.”

He cited instances of cryptocurrencies being used to fund various terrorist groups, as well as countries under US sanctions, including Russia and North Korea.

Adeyemo expressed hope that lawmakers will approve a secondary sanctions tool aimed at foreign digital asset providers facilitating illegal activities.

The US Treasury is also seeking the ability to pursue overseas-based crypto platforms when they harm US national security while using the country’s financial system.

In October 2023, the WSJ reported that Palestinian militants received at least $134 million in digital assets. The publication prompted a strong reaction from US lawmakers, who demanded action from the Justice Department against the industry. They specifically pointed to Binance and Tether.

Chainalysis analysts stated that when calculating terrorist-linked cryptocurrencies, many incorrectly include third-party funds that passed through various payment services interacting with criminals.

Experts from Elliptic also noted the exaggeration of the scale of terrorist group financing in cryptocurrencies.