US Deputy Treasury Secretary Advocates for Enhanced Crypto Enforcement Powers

In testimony before the Senate Banking Committee, Deputy Treasury Secretary Adewale Adeyemo reiterated the department’s call for increased enforcement powers to combat illicit finance, terrorism, and sanctions evasion in the crypto space. Adeyemo outlined three proposed reforms, including the introduction of secondary sanctions targeting foreign digital asset providers engaging in illicit finance. He emphasized the need for clarification that US authorities can reach extraterritorially when such entities harm national security while exploiting the financial system.

The Treasury also seeks to expand existing authorities to cover the digital asset ecosystem and address jurisdictional risks posed by offshore cryptocurrency platforms. Adeyemo highlighted the overlap between these proposals and bills from the Senate Banking Committee, particularly the Digital Asset Anti-Money Laundering Act of 2022. He cited concerns over crypto’s use by terrorist groups, North Korea, and in illicit trades, warning of potential growth without Congressional action.

Committee chair Sherrod Brown voiced support for the Treasury’s enforcement goals, while ranking member Tim Scott focused on foreign policy threats. Adeyemo’s testimony underscores the ongoing regulatory scrutiny of cryptocurrencies and the push for enhanced measures to mitigate risks associated with their use in illicit activities.