US Justice Department Announces The Formation of The National Crypto Security Unit
A representative from the Office of the Attorney General has stated that the United States authorities will play a greater role in enforcing laws against individuals who use cryptocurrency for financial fraud and other forms of cybercrime.
On Oct. 6, Deputy Attorney General Lisa Monaco announced the formation of the Justice Department’s National Cryptocurrency Operations Team, a program targeted at platforms “that assist criminals in laundering or concealing their unlawful gains.” Monaco mentioned her office’s action against the Darknet-based Bitcoin (BTC) blending provider Helix in August, but she stated that the United States government should do more to combat the cryptocurrency black market.
The Need for Cyber Security Professionals
As Monaco put it, “we want to enhance our ability to demolish the financial environment that allows these illicit players to grow and, quite frankly, to benefit from what they’re doing,” she said. To accomplish this, we will call on our cyber professionals, cyber prosecutors, and money laundering specialists for assistance.
“Cryptocurrency exchanges aspire to be the financial institutions of the future,” she continued. “The systems must be trusted by the public, and we must be prepared to weed out abuse before it can take root.” With the rise of ransomware and hacks involving cryptocurrency transactions, Monaco has frequently played a key role in the response of the United States government. The task team that “discovered and reclaimed” millions of Dollars in Bitcoin (BTC) given to DarkSide cybercriminals based in Russia following an attack on the Colonial Pipe network in May was led by her. Another initiative outlined by the Deputy Attorney General is to prosecute federal employees that fail to report data breaches or refuse to follow security best practices when dealing with government contracts.
Application of Crypto Laws
Attorney General William Barr of the United States of America provided legal instructions for regulating cryptocurrency exchanges. The rules were developed by the lead US attorney’s Cyber-Digital Task Force and are officially titled Cryptocurrency: An Enforcement Framework, according to an Oct. 8 2020 announcement from the US Department of Justice.
The guidelines come after the Department of Justice and the United States Commodity Futures Trading Commission launched an investigation into cryptocurrency derivatives exchange BitMEX, alleging several illegal acts. The extensive paper had 83 pages of information about cryptocurrency, its “legal applications,” its “unlawful uses,” applicable regulatory authorities, and a future game plan.
The Justice Department expressly mentions Zcash, Monero, and DASH usage as “indicative of potential illegal activity.” The article further said that the United States has jurisdiction over people whose crypto transactions involve servers located in the United States. As the report stated, the developing crypto and blockchain field is multifaceted, as are criminal operations such as pump and dumps – an age-old unlawful stock market practice modernized by crypto.
Among the framework’s specified permissible crypto use cases were payments for products and services without the involvement of third parties. “Proponents of cryptocurrency argue that by removing the need for intermediaries to corroborate and execute transactions, virtual currency has the potential to decrease transaction costs and financial corruption,” the report explained, before recommending cryptocurrency as a hedge against inflation. In addition to the above-board uses, the report detailed what it alleged were unlawful activities, such as drug exchanges.
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