US Treasury Announces Crypto-Crackdown, In Push Against Money Laundering, Illicit Finance

The United States Treasury has just released a 55-page report on its strategy for fighting terrorism and illegal finance, and of course crypto has its part in it.

Titled ‘2024 US National Strategy for Combating Terrorist and Other Illicit Financing’, the report emphasises the threat of illicit finance to “national security, prosperity, and democracy”.

Related: As BTC Soars to $66K, Analyst Says This Sign Could Mark the End Of the Downtrend

The report highlights the continuous adaptation of the US anti-money laundering and counter-terrorism financing systems to prevent illicit proceeds from reaching those who threaten national security and public safety.

The report said:

While the United States has made significant progress over the past two years in addressing illicit finance challenges, it must maintain this momentum in modernizing the AML/CFT regime and continue to effectively utilize existing tools and authorities to combat illicit finance risks and prepare itself to face any new challenges on the horizon.

United States Treasury

Treasury highlights the increasing threats posed by the digitisation of financial services, including the use of cryptocurrency for illicit activities.

Specific measures include efforts to enhance the transparency and regulatory oversight of digital asset markets to prevent their misuse by illicit actors. This includes actions to mitigate risks associated with decentralised finance (DeFi) platforms and peer-to-peer transactions which can facilitate money laundering and terrorist financing without traditional intermediaries, the report claimed.

Treasury Stresses International Cooperation Is Key

Additionally, the strategy addresses the vulnerabilities and risks associated with cryptocurrency exchanges, particularly those operating without adequate regulatory compliance. The Treasury emphasises the importance of international cooperation to regulate these platforms and ensure they adhere to anti-money laundering (AML) and counter-terrorist financing (CFT) standards.

The Treasury also wrote about what it calls “the largest settlements in Treasury’s history with Binance”.

Binance and former CEO Changpeng Zhao (CZ) had been in legal proceedings over violations of anti-money laundering laws and the Bank Secrecy Act (BSA).

CZ was subsequently sentenced to a four-month prison term. While the prosecution had asked for three years, District Judge Richard Jones decided against such a harsh penalty. 

The Judge made a point that he doesn’t believe CZ to be a criminal like FTX’s Sam Bankman-Fried and reduced the length of the sentence due to CZ’s positive reputation.

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