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Senators Call for Curbing Russia’s Use of Crypto to Evade Sanctions

Sens. Elizabeth Warren, D-Mass., and Roger Marshall, R-Kan., urged the Biden administration April 29 to counter Russia’s use of cryptocurrency to evade U.S. financial sanctions and buy high-tech weaponry for its war against Ukraine.

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In a letter to five administration officials, including Treasury Secretary Janet Yellen and Defense Secretary Lloyd Austin, the senators said that, even though the Treasury Department sanctioned Russia's preferred virtual currency exchange, Garantex, in 2022 (see 2204060081), the platform continues to facilitate Russian arms trading. The senators said they're concerned that Iran, North Korea and terrorists also increasingly use crypto to side-step sanctions.

“The national security threat posed by cryptocurrency requires a commensurate response by our country’s defense community,” the senators wrote. “As terrorists and rogue nations like Russia, North Korea and Iran increasingly turn to crypto to evade sanctions, our tools to defend these sanctions must evolve with the threat.”

Treasury Secretary Wally Adeyemo told the Senate Banking Committee on April 9 that his department sent a series of proposals to Congress in November that would, among other things, give his department additional sanctions tools to go after foreign digital asset providers that facilitate illicit finance (see 2404090037).