Senator Elizabeth Warren testified before the Senate Armed Services Committee on May 4, where she highlighted the use of crypto in crime and sanctions evasion.
Russia, North Korea’s crypto use in 2022
During her testimony, Warren said:
“Cryptocurrency is now the method of choice for countries to circumvent sanctions so they can finance weapons programs that support espionage and promote cyber-attacks.”
Warren explained that while much cryptocurrency-related crime is “hidden,” more than $20 billion in illicit transactions took place over the course of 2022, an estimate consistent with recent data from Chainalysis. Warren further noted that Russia and North Korea have moved at least $8 billion through cryptocurrency.
She added that North Korea is using stolen cryptocurrencies to fund nuclear weapons programs, according to the UN Security Council. Lt. Gen. Scott D. Berrier acknowledged that this is “a threat we recognize” when asked by Warren if it was.
Warren also asked Avril D. Haines, director of national intelligence, if crypto poses such a threat. Haines responded by stating that cryptocurrency not only contributes to North Korea’s weapons development, but also threatens network security.
Warren highlights Islamic groups, Russian ransomware
Warren also said Binance has handled $8 billion worth of Iranian crypto transactions since 2018. She said those transactions included some of the cryptocurrency earned by the Islamic Revolutionary Guard Corps, which operates the country’s largest Bitcoin mining operation.
Finally, Warren said that leading ransomware groups are believed to be controlled by Russian actors and added that virtually 100% of ransomware payments are made as payment, based on data from a previous Homeland Security report.
Haines and Berrier again replied that those activities are a threat.
Warren concluded that she and Senator Roger Marshall plan to reintroduce a bill to strengthen regulation of crypto-created crime. She said this bill differs from securities regulations that are designed to protect investors from fraud.
Warren has long been a harsh critic of cryptocurrency. In late March, she said her re-election campaign would involve “building.”[ing] an anti-crypto army.” She previously attempted to pass a crypto regulation bill in December 2022.
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