The U.S. government has sanctioned crypto platforms that do business with entities on the sanctions list, which in turn has made it difficult for these companies to conduct their daily operations and have forced them to close down or leave the market altogether.
By prohibiting U.S financial institutions from dealing with them in any way, including by blocking their assets and denying them access to the American market. The crypto platform must create a plan that will get it removed off of the US sanctions list or stop doing business with sanctioned entities if they want to do business in America again.
Senator Elizabeth Warren (D., Mass.) said she would introduce legislation Thursday to block the use of cryptocurrency platforms by Russia to undermine sanctions.
The revenue generated by cyberattack ransoms and cryptocurrency mining won’t replace regular business activity in sanctioned nations, experts said at a US Senate hearing Thursday.
Crypto markets cannot handle the volume of cash needed to operate a major economy, witnesses testified to the Senate’s Banking, Housing, and Urban Affairs Committee.
There is not enough liquidity to run a G-20 economy on cryptocurrency, says Michael Mosier, former acting director of the Financial Crimes Enforcement Network for the US Treasury Department.
During the hearing, fears grew that Russia may resort to cyberattacks and cryptocurrency to prop up its economy, which has been battered by economic sanctions as it continues to invade Ukraine.
Moody‘s Investors Service warned on March 11 that Russia’s state-sponsored hackers may target banks, crypto platforms, and intellectual property.
“There is a growing risk that Russian government and nongovernmental cyber actors will attempt cyberattacks across sectors and regions if they wish to raise illicit funds,” Moody’s said.
At Thursday’s hearing, Sen. Elizabeth Warren (D., Mass.) said she would introduce a bill immediately that would authorize the Treasury Department and White House to sanction cryptocurrency firms that deal with sanctioned Russian entities. Russian elites are attempting to block one avenue of wealth-building. There are nine senators on the Banking Committee who are co-sponsors of the bill, according to her.
The argument that Russia can evade sanctions by moving its assets into crypto cannot be made, Warren said.
She added that for Putin and his oligarchs, however, for a billion or two, or a few hundred million, crypto seemed like a really good option, referring to Vladimir Putin of Russia.
Law enforcement agencies in the United States, including the Federal Bureau of Investigation and the Cybersecurity and Infrastructure Security Agency, have warned U.S. companies they may be facing cyberattacks from Russia, either directly or indirectly, as a result of the war in Ukraine.
United Nations officials charged North Korea with using cyberattacks to circumvent sanctions in 2020, and the U.S. responded by sanctioning alleged state-backed hacking groups.
Cyberattacks have traditionally been denied by Pyongyang.
The Russian government consistently denies involvement in cyberattacks, and Senate hearing witnesses said they had seen no evidence that Russia had been using tactics similar to those of North Korea.
Jonathan Levin, co-founder and chief strategy officer at Chainalysis Inc., a cryptocurrency analytics company, shared that at present, they hadn’t seen evidence of Russia or Putin being systematically evading sanctions through cryptocurrencies.
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Chris Munch is a professional cryptocurrency and blockchain writer with a background in software businesses, and has been involved in marketing within the cryptocurrency space. With a passion for innovation, Chris brings a unique and insightful perspective to the world of crypto and blockchain. Chris has a deep understanding of the economic, psychological, marketing and financial forces that drive the crypto market, and has made a number of accurate calls of major shifts in market trends. He is constantly researching and studying the latest trends and technologies, ensuring that he is always up-to-date on the latest developments in the industry. Chris’ writing is characterized by his ability to explain complex concepts in a clear and concise manner, making it accessible to a wide audience of readers.
