Senator calls on agencies to take action to prevent criminal cryptocurrency use

Sen. Maggie HassanMargaret (Maggie) HassanHassan launches first ad of reelection bid focusing on veterans’ issues Scott Brown’s wife files to run for Congress Conservation group says it will only endorse Democrats who support .5T spending plan MORE (D-N.H.) on Thursday raised considerations round the usage of cryptocurrency for legal means, urgent key federal companies to take motion.

The senator’s considerations have been raised after escalating ransomware and different cyberattacks over the previous yr wherein hackers used cryptocurrency markets to acquire funds from victims seeking to regain entry to their networks. 

Hassan, a member of the Senate Homeland Safety and Governmental Affairs Committee, sent a letter detailing her considerations to the leaders of the Justice Division, the Division of Homeland Safety, the Inside Income Service, the Securities and Alternate Fee, and the Treasury Division’s Monetary Crimes Enforcement Community. 

Hassan pointed to a latest incident in her residence state of New Hampshire wherein $2.3 million was stolen from the town of Peterborough, with the funds unable to be recovered after they have been transformed by the attackers into cryptocurrency.

“The anonymity offered by cryptocurrency has helped facilitate its use by criminals in a myriad of the way,” she warned. “These makes use of embody drug gross sales over the darkish net, funds for ransomware assaults, tax evasion, financing for terrorism and arranged crime, cash laundering, and extra.”

The senator requested for particulars round what authorities the companies had over regulating U.S.-based cryptocurrency exchanges, what extra authorities they want, and whether or not cryptocurrency exchanges needs to be required to reimburse these topic to fraud attributable to the usage of the trade.

Not one of the companies Hassan despatched letters to responded to The Hill’s request for remark.

The potential elevated regulation of cryptocurrency has come underneath the microscope on Capitol Hill in latest months, with debate over amendments on this topic delaying the Senate’s $1 trillion infrastructure package deal in August. Lawmakers on each side of the aisle are prone to proceed preventing for points round regulating cryptocurrency this month.

The efforts have turn into more and more consequential after mounting cyberattacks, together with separate ransomware assaults in Could on Colonial Pipeline and meat producer JBS USA, quickly threatening key provide chains. 

Each corporations selected to pay the ransoms demanded by the hackers in an effort to rapidly ramp as much as full manufacturing once more, with Colonial Pipeline paying the equivalent of $4.4 million in bitcoin, and JBS paying the equivalent of $11 million in bitcoin. The Justice Division later recovered simply over half of the ransom paid by Colonial Pipeline.

The Justice Division released a framework final yr warning of accelerating safety considerations round the usage of cryptocurrency, with the framework noting that “few applied sciences are extra probably transformative and disruptive—and extra probably inclined to abuse.”