By Shelly Melancon (Switzerland)
The United States Treasury has said that it must evolve strategies to cope with the increasing adoption of digital currencies. The Treasury says that it must adapt and modernize itself to meet the demands of a changing financial system that could pose threats to the efficacy of sanctions that it has placed.
The Treasury noted these in a report that it issued on October 18. The report said that it has made a review of sanctions and steps that the government could do more to create stronger policies to protect the economy from digital assets. The treasury noted that the widespread adoption of digital currencies will disturb the enforcement of sanctions while providing alternative routes for the movement of funds.
The treasury recommended intensified efforts to discuss the issue with financial institutions and the crypto community to find the best path and deepen the overall knowledge of cryptocurrencies. This, it said, would enable the government to create better policies.
The Deputy Treasury Secretary, Wally Adeyemo, said in the report that it is fundamentally important to national security that sanctions are unhindered, and that the Treasury is open and committed to working with allies and key players in the crypto industry to modernize and structure it in a way that won’t cause harm to the Treasury and its sanctions.
Also read:To achieve this, the report said, the Treasury has asked the government to create policies and frameworks to enable them to collaborate with allies and partners, educate on the importance of sanctions, and create enforceable sanctions geared towards reducing negative effects on the economic and political scenes.
The US Treasury is actively involved in national security through the imposition of sanctions on financial institutions, firms, and companies that are complicit in matters affecting national security. An example is the Treasury’s sanctions imposed on a Russian-based business and the Czech Republic after an investigation into a May attack on the Colonial Pipeline System was concluded.
Crypto Regulation in the US
The US has called for more regulations to help ease the tension in the financial sector over the rise of cryptocurrencies and the cases of illegal use. For example, hackers have increased their activities targeting the US and companies based there. Ransomware hackers operate by seizing control of software that controls systems. The ransomware hackers will only release control when payments are made.
The US Treasury said that an estimated $590 million was paid for ransomware attacks in the first six months of 2021. It said that the Treasury is committed to fighting ransomware hackers and protecting industries through stronger sanctions. Wally Adeyemo said that the Treasury wants to make it harder for digital criminals to access the ransoms paid, but that it needs more collaboration from other players in the industry.
Sanctions are not a new concept in fighting crime, but they are only effective when there is no means to circumvent their effects. The Treasury recognizes the risk that digital tokens pose to the implementation of sanctions.
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