In the letter sent Wednesday, the senators asked Treasury Secretary Janet Yellen if the Office of Foreign Assets Control had a way of making sure the crypto industry was complying with sanctions.
We obtained a copy of the letter for you here.
“Strong enforcement of sanctions compliance in the cryptocurrency industry is critical given that digital assets, which allow entities to bypass the traditional financial system, may increasingly be used as a tool for sanctions evasion,” the letter stated.
The EU, UK, and the US have responded to the invasion of Ukraine by imposing sanctions on Russian banks, politicians, and oligarchs. However, some have raised concerns that the crypto industry could be used to evade the sanctions because it is not regulated like traditional financial institutions.
However, the Biden administration said that crypto could not be used to completely evade sanctions.
“The scale that the Russian state would need to successfully circumvent all U.S. and partners’ financial sanctions would almost certainly render cryptocurrency as an ineffective primary tool for the state,” said Carol House, the director of cybersecurity for the National Security Council.
Still, the Democrat senators want to know whether the treasury department has measures to ensure the cryptocurrency industry’s compliance with the sanctions. The senators demand a response by March 23.