As the use of digital assets and emerging financial technologies continues to increase, US lawmakers took a step on Thursday to address the possible misuse of cryptocurrencies by terrorists and criminals. The proposed bipartisan bill would establish an Independent Financial Technology (FinTech) Working Group tasked with researching and regulating cryptocurrency transactions. This working group would include representatives from the Central Intelligence Agency, the Federal Bureau of Investigation, the Department of Justice, the Secret Service, the Financial Crimes Enforcement Network, and the State Department. Additionally, the Under Secretary for Terrorism and Financial Intelligence would appoint five representatives from financial technology companies, financial institutions, and research organizations.
Recent reports indicate that illicit crypto transaction volume is at an all-time high of $20.6 billion and terrorist financing also saw an increase from the previous year. The interplay of finance, tech, and crime is a major concern, as demonstrated by the emergence of crypto mixers such as Tornado Cash and Sinbad.io, whose purpose is to obfuscate financial links to organized crime. This has led to the proliferation of anti-money laundering regulations, such as the Financial Action Task Force’s Travel Rule, whose implementation has been challenging but is necessary to prevent further misuse of digital assets.
Despite the increase in illicit crypto activity this year, the trend has been downward, with only less than 1% of total volume attributed to criminals. Such activity is minimal when compared to traditional banking systems, yet officials are still concerned about the risk of privacy and anonymity that comes with digital assets. The proposed bill is intended to tackle the issue of terrorism and illicit financing head-on by creating a specialized working group that can take a closer look at the matter.
Ultimately, the Financial Technology Protection Act of 2023 could lead to a securer digital asset market and a safer currency system, where terrorist networks cannot move or hide their money. Such legislation, if approved, could be a major step forward against terrorism and crime.
Lucy Clark
- 2023-04-27
US Lawmakers Introduce Bipartisan Bill to Tackle Misuse of Cryptocurrencies
US lawmakers have proposed a bipartisan bill, the Financial Technology Protection Act of 2023, to address the possible misuse of cryptocurrencies by terrorists and criminals. The bill would create an Independent Financial Technology Working Group tasked with researching and regulating cryptocurrency transactions.
