US Treasury Closely Monitoring Sanction Invasion Attempts Using Crypto: Yellen

US Treasury Secretary Janet Yellen has asserted that the Treasury Department is closely monitoring Russia’s attempts at bypassing monetary sanctions using cryptocurrency. Yellen made the comments at a conference hosted by the University of Illinois on Wednesday, where she noted:

“We will continue to look at how the sanctions work and evaluate whether or not there are leakages, and we have the possibility to address them.”

The strong comments came after four US senators wrote to the Treasury Secretary about the “Treasury Department’s progress in monitoring and enforcing sanctions compliance by the cryptocurrency industry.”

The senators voiced some of their “concerns that criminals, rogue states, and other actors may use digital assets and alternative payment platforms as a new means to hide cross-border transactions for nefarious purposes.”

US Treasury: Participants of Crypto Industries Subject to AML and Sanction Rules

Commenting on the possible use of crypto for sanctions evasion, Yellen noted:

“I often hear cryptocurrency mentioned, and that is a channel to be watched.”

The Treasury Secretary also noted that most parties in the crypto space are subject to any-money laundering and sanction requirements.

That said, many top crypto exchanges, including Coinbase, Binance, and Kraken, have announced that they are open to complying with the government to issue sanction requirements. However, these same exchanges have turned down calls from the vice prime minister of Ukraine to ban all Russian users.

This refusal spurred outrage from former US presidential candidate Hilary Clinton, who later called on the Biden administration to strong-arm crypto exchanges to ban Russian users. However, Yellen has clarified that the crypto industry is “not that that sector is completely one where things can be evaded.”

Last October, the US Treasury Department published a sanction review, noting: “We are mindful of the risk that, if left unchecked, these digital assets and payments systems could harm the efficacy of our sanctions.”