The US Treasury Highlights Crypto’s Role in Criminal Activities
The US Treasury has released its 2024 National Risk Assessments on Money Laundering, Terrorism Financing, and Proliferation Financing, revealing that scammers and criminals are increasingly turning to digital currencies for illegal purposes.
Crypto’s Minor Role in Money Laundering Compared to Cash
The report emphasizes that while cryptocurrencies have become a tool for criminal activities, cash remains the preferred choice for money laundering due to its anonymity, stability, and widespread acceptance.
Increased Oversight and Enforcement Needed
The US Treasury argues that the growth of the crypto market poses a threat to national security and calls for greater oversight and enforcement against money laundering. The department plans to publish a strategic plan with recommendations to address these issues.
Cash Remains a Preference for Money Laundering
Despite the use of cryptocurrencies by criminals, the Treasury notes that money launderers still prefer cash due to its advantages as a form of payment. Cash offers anonymity, stability, and ubiquity.
Virtual Assets and Money Laundering
The report highlights that criminals commonly use US dollar banknotes to launder money both domestically and internationally. The Treasury also acknowledges the importance of regulating virtual asset service providers (VASPs) such as crypto exchanges to prevent money laundering.
Noncompliance and Misuse of Exchanges
The US Treasury points out that some VASPs fail to comply with US policies, making them vulnerable to being used for money laundering. The report cites the $4.3 billion Binance.US settlement as an example of noncompliance leading to the misuse of exchanges for illicit activities.
DeFi Protocols and Crypto-Mixing Services
The Treasury identifies decentralized finance (DeFi) protocols and crypto-mixing services as emerging methods for moving and laundering criminal proceeds. These platforms enable the transfer of funds while concealing the source or destination of transactions.
Disclaimer
The information provided is not financial advice but for educational and informational purposes only. Any investment decisions should be based on your own risk tolerance and due diligence. Bitcoin and other cryptocurrencies are high-risk investments. We are not liable for any losses incurred as a result of investments related to the provided information.
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