WASHINGTON(Washington Insider Magazine) – Senator Elizabeth Warren, D-Massachusetts, is drafting legislation that she thinks would make it more difficult to use cryptocurrencies to circumvent sanctions as the US looks for new methods to punish Russia for attacking Ukraine.
The idea, which is still in the proposal form, has gained additional urgency as bipartisan worries rise that members of Moscow’s elite may circumvent sanctions by utilizing digital currency. By imposing secondary sanctions on overseas crypto exchanges, it hopes to compel corporations to choose between doing trade in the United States or with sanctioned persons and entities.
According to NBC NEWS, Warren and the leaders of 3 major Senate committees addressed the matter with Secretary Of the treasury Janet Yellen the previous week when they asked for specifics regarding the Treasury Department’s enforcement of industry compliance with Russian sanctions.
Sanctions have been imposed on Russia’s central bank and military sector, and also President Vladimir Putin as well as rich members of his close circle, by the Biden administration.
While the government has the right to impose crypto sanctions alone, Warren’s bill may be used to exert pressure, similar to how Congress has increased efforts for President Joe Biden to ban Russian oil imports.
Senators over both corners of the floor are concerned that cryptocurrency is gaining traction as a means of circumventing existing sanctions.
The Treasury Department stays optimistic about the effectiveness of the procedures in place, according to a Treasury official.
One of Warren’s proposed legislation would require financial organizations to keep extensive records and send reports to the Department Of the treasury, making it simpler to verify clients’ identities and transactions to private crypto wallets. The Treasury Department’s Financial Crimes Enforcement Network, or FinCEN, is in the process of crafting a similar regulation, but Warren’s measure would make it mandatory.
FinCEN also issued a warning to financial organizations on Monday about evading penalties, adding that cryptocurrencies have not become a serious problem.
According to various accounts, several nations that have been struck severely by sanctions have adopted cryptocurrencies to avoid the consequences of punitive financial measures. According to a United Nations assessment, North Korea has used stolen cryptocurrency to help fund its missile development, while Iran has mined cryptocurrencies to assist offset sanctions.
