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US Treasury to Closely Monitor Crypto Sector to Prevent Russia from Bypassing Sanctions

US Treasury to closely monitor crypto sector to prevent Russia from bypassing sanctions
  • Senate Democrats are concerned about the possibility that Russia would exploit digital assets to circumvent sanctions to avoid being sanctioned.
  • In her statement, Yellen indicated that the United States would continue to oversee the bitcoin industry.
  • The Treasury Department feels that cryptocurrency is not the only industry where things may be gotten around.

The Treasury Secretary of the United States, Janet Yellen, indicated that the United States would closely watch Russia’s possible use of cryptocurrencies to evade penalties. After many Senate Democrats expressed concerns about the potential of the new asset class to evade sanctions, the White House issued a statement.

Senate Democrats Seek Clarity on Crypto Amid Sanctions

A group of Senate Democrats has written to the Treasury Department, requesting more information on what the Treasury Department is doing to ensure that cryptocurrencies are not being used to circumvent sanctions against Russia. The letter was sent in response to a letter from the Senate Finance Committee.
Lawmakers, including Elizabeth Warren and Sherrod Brown, the chairman of the Senate Banking Committee, have expressed worry that some cryptocurrency businesses may be failing to comply with the new regulations. They also requested more specific details on how regulators would monitor and execute the sanctions imposed by the United States on Russia due to the latter’s invasion of Ukraine.
The Democrats went on to say that since the sanctions were issued, there has been a significant increase in bitcoin trading activity. The bitcoin price has increased dramatically recently, rising by more than 16 percent in the last two days.
Several senators have asked for more information on how simple it is for the Treasury Department’s Office of Foreign Assets Control to engage with government authorities to determine if new tools are required and ensure compliance with the law.
Even though bitcoin has been often referenced, Yellen emphasized that it does not seem to be the sole conduit through which sanctions might be avoided.
Many major cryptocurrency exchanges have turned down a request to block Russian addresses made by Ukraine’s Minister of Digital Transformation Mykhailo Fedorov. However, they are still complying with the sanctions imposed on the country. Binance, Coinbase, and Kraken are among the businesses that have refused the request.
In a statement, the leading cryptocurrency exchange Binance claimed that it is taking the appropriate measures to guarantee that the business takes action against people who have imposed penalties on their accounts. The deal also noted that it would be pleased to take further steps if penalties were expanded.

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