Bipartisan Lawmaker Appeal Targets Cryptocurrency Role in Terror Financing
Summary:
A letter co-authored by Senator Elizabeth Warren and signed by 28 senators and 76 House members highlights concerns about the use of cryptocurrencies in financing terrorism. The bipartisan letter, addressed to Treasury Under Secretary Brian Nelson and National Security Advisor Jake Sullivan, cites claims that Hamas and the Palestinian Islamic Jihad raised over $130 million in crypto donations with little recovery. Urging swift action to curb illicit crypto activities, the letter includes questions about the government's information and strategies related to crypto-financed terrorism. The letter also garners support from prominent anti and pro-crypto legislators.
Senator Elizabeth Warren spearheaded a bipartisan appeal, subscribed to by 28 fellow senators and 76 House members, regarding the application of cryptocurrency in funding acts of terrorism. Although the predominant signatories were Democrats, the appeal saw participation from both focal political parties and one independent representative. Directed to Brian Nelson, Under Secretary for Terrorism and Financial Intelligence at the Treasury, and Jake Sullivan, National Security Advisor, the letter was dated 17th October. In the letter, the authors referenced a news piece alleging that between August 2021 and June 2023, Hamas and the Palestinian Islamic Jihad accrued over $130 million through cryptocurrency donations, with very little of these funds recovered to date. The letter hammered in the underlying threat posed by cryptocurrencies to national security, as exemplified by the deadly Hamas attack on Israeli civilians, financed through its advanced cryptofinancing methods, pressing for immediate measures to significantly curb unlawful crypto activity. The letter culminated with nine pressing questions for the administration of President Joe Biden on their knowledge and strategies regarding cryptocurrency-linked terrorism financing. Senator Warren stands as one of the most vocal critics of cryptocurrency in U.S. Congress, known for her introduction of the Digital Asset Anti-Money Laundering Act in December, which has gained traction amid the ongoing Israel-Hamas warfare.
Noteworthy signatories of the letter include vocal crypto critics like Roger Marshall and Sean Casten, along with Senate Banking Committee chair Sherrod Brown, a known advocate for crypto regulation, who however was not in support of Warren’s bill. Pro-cryptocurrency members like Cynthia Lummis, Kirsten Gillibrand and Patrick McHenry refrained from signing the letter, although many of the signatories held no prior stance on the subject. Notably, Jake Auchincloss and Josh Gottheimer, who had demonstrated pro-crypto voting records, also appended their signatures to the letter.
Prepared statements by Nelson, released by the Treasury Department on October 17, revealed his comments at a Deloitte Anti-Money Laundering conference, where he underscored the sophisticated and covert financial strategies employed by Hamas to access the formal financial system. Furthermore, he emphasized the Treasury’s persistent efforts to ensure transparency in virtual assets, targeted at stymieing the illicit operations of criminals, rogue states, and financiers of terrorism. On October 18, the Treasury's Office of Foreign Assets Control proceeded to impose sanctions on a Gaza-based virtual currency exchange, its operator, and several other affiliates of Hamas.
Published At
10/18/2023 6:00:00 PM
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