The U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) proposed increasing transparency around cryptocurrency “mixers” on Thursday, a measure meant to combat the use of these anonymized software tools by terrorist groups like Hamas.
THE TAKE
FinCEN’s measure underscores increasing concern among U.S. officials about the role of crypto in financing terrorist groups, an issue which was brought to the forefront by Hamas’ recent attack in Israel.
CONTEXT
* The crypto community has long touted digital assets as vehicles for anonymous transactions, but regulators have cracked down on the industry with a slew of federal enforcement actions.
* Hamas uses a global financing network to funnel support from charities and friendly nations, including by using cryptocurrencies.
* The Biden administration issued sanctions to disrupt Hamas’ funding on Wednesday, which included a Gaza-based crypto exchange. U.S lawmakers have urged the White House to swiftly crack down on the use of cryptocurrencies to evade sanctions and fund the operations of groups like Hamas and Hezbollah.
* The U.S. imposed sanctions on crypto mixers Tornado Cash and Blender last year.
KEY QUOTE
“Today’s action underscores Treasury’s commitment to combatting the exploitation of Convertible Virtual Currency mixing by a broad range of illicit actors, including state-affiliated cyber actors, cyber criminals, and terrorist groups,” said Deputy Treasury Secretary Wally Adeyemo in a statement.
Reporting by Hannah Lang in Washington; editing by Michelle Price and Deepa Babington
Our Standards: The Thomson Reuters Trust Principles.
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