US Treasury assistant secretary for Terrorist Financing and Financial Crimes Elizabeth Rosenberg has admitted that it remains possible that Russia is using crypto to swerve sanctions.
She said authorities need to exert the utmost caution in preventing this from happening. She was responding to a question by Elizabeth Warren and other lawmakers.
The US already has experience in tracking cryptocurrency transactions that may have been used by sanctioned regimes to dodge sanctions. However, the Senate Committee on Banking, Housing and Urban Affairs is moving forward to discuss solutions to the problem.
Some of the issues that the Committee wants to discuss also include the potential seizure of more Russian assets to help Ukraine recover from the war that Russia waged against it.
But the possibility of cryptocurrencies being used to dodge sanctions remains. There are some mixed opinions in public space as to whether this can happen.
However, Warren said that North Korea has been using cryptocurrencies to skirt sanctions for years now. Iran is also digitalizing its economy in the hope of pulling away from the US dollar.
The US and others are moving in quickly to limit the reach of blockchain and cryptocurrencies companies, as well as the darknet’s Hydra Market and Garantex. But crypto is not the real threat.
Admittedly, North Korean hackers have been securing significant amounts of stolen crypto, but the use of a network of banks, as per the Wall Street Journal, is still the leading way for the country to avoid some of the sanctions.
Russia is also banking on its Mir banking network, but this may seem less of an option right now as Turkey and now Vietnam, as well as Kazakhstan, have cut themselves off from the system and seem to be increasingly aligned with the West.