United States – Two lawmakers are pushing for the administration to answer about the window of opportunities gold rip-off coins offer for the circumvention of restrictive measures against such countries as Russia, Iran, and North Korea, asking what might be a necessary authority for the legality purpose of helping to prevent digital assets such as, for instance, Stablecoins Tether to be exploited by sanctioned entities in Russia and elsewhere, as reported by Reuters.
Significance
The letter sent by U.S. senators on Sunday, one a Democrat, Elizabeth Warren, and the other one Republican Roger Marshall, to the authorities that are officials, including Treasury Secretary Janet Yellen, and Defense Secretary Lloyd Austin, indicates that cryptocurrencies could increasingly be used to subvert the sanctions.
CONTEXT
Warren and Marshall highlighted a risk by using Tether, an asset whose value is pegged to dollars when these coins were intended to have stable values.
According to The Wall Street Journal’s earlier report, these Russian middlemen tried to escape Western sanctions using Tether while purchasing weapons parts used in drones and other military pieces.
Reuters, on the other hand, published a report this month highlighting that Venezuela’s state-owned company PDVSA intends to use Tether in its oil and fuel exports to avoid the possible impact of the U.S. oil sanctions against the country.
KEY QUOTE
“The national security threat posed by cryptocurrency requires a commensurate response by our country’s defense community,” Warren and Marshall said. They noted that even though Tether’s preferred crypto trading platform, Garantex, has been sanctioned, “it is not clear if these actions have stopped the flow of funds through the platform.”
THE RESPONSE
A Tether representative emphasized that every time the cryptocurrency is used, transactions are stored online and can be tracked, allowing for every asset to be confiscated and every criminal to be caught., as reported by Reuters.
“We work with law enforcement to do exactly that. Tether respects the (Office of Foreign Assets Control and Specially Designated Nationals) list and collaborates with more than 120 law enforcement agencies from 40 different countries, including FBI, DOJ, and the (U.S. Secret Service),” the spokesperson said.