Senators Elizabeth Warren and Roger Marshall have directed inquiries to the Biden administration regarding the utilization of cryptocurrency to circumvent sanctions in countries like Russia, Iran, and North Korea.
Their letter, addressed to officials including Treasury Secretary Janet Yellen and Defense Secretary Lloyd Austin, underscores a growing concern about the potential misuse of digital assets in evading sanctions.
Of particular focus in the senators’ communication is Tether, a stablecoin tied to the value of the U.S. dollar, which has raised red flags due to its potential role in bypassing sanctions.
Recent reports have highlighted instances where Tether was allegedly used by Russian intermediaries to sidestep Western sanctions, facilitating the procurement of military equipment components.
Venezuela’s state-run oil company, PDVSA, reportedly intends to employ Tether in its crude and fuel exports as the U.S. prepares to reimpose oil sanctions on the country.
In their letter, Warren and Marshall underscored the need for a robust response from the defense community to address the national security implications posed by the use of cryptocurrency in sanctions evasion.
They expressed concerns about the effectiveness of current sanctions against Tether-related platforms, questioning whether such measures have successfully halted illicit financial flows.
Responding to these inquiries, a spokesperson for Tether emphasized the cryptocurrency’s traceability and cooperation with law enforcement agencies worldwide.
They asserted that Tether operates transparently online, facilitating the tracking and seizure of assets involved in illicit activities.
The spokesperson highlighted Tether’s collaboration with over 120 law enforcement agencies from 40 countries, including prominent U.S. entities like the FBI, DOJ, and Secret Service.
The senators’ inquiries signal a heightened scrutiny of the cryptocurrency landscape amid growing concerns about its potential misuse in circumventing international sanctions.
