Sen Elizabeth Warren has opposed the growing cryptocurrency lobbying efforts in Washington calling on all stakeholders to support regulations to clamp down on terrorist financing amid other concerns.
In a letter addressed to the United States Blockchain Association, the senator expressed dismay over increasing efforts to cripple attempts of the present administration to tackle funds flowing to terrorists and other ethical issues within the subject matter.
According to the letter, the blockchain association and other executives have deployed a team of former defense and national law enforcement officials to lead lobby efforts in Washington.
“I write regarding a troubling new report that your association and other crypto interests are flexing a “not-so-secret weapon: a small army of former defense, national security, and law enforcement officials” to work on your behalf to undermine bipartisan efforts in Congress and the Biden Administration to address the role of cryptocurrency in financing Hamas and other terrorist organizations.”
Citing the Oct 7 attack by Hamas against Israel, the letter states that more information has come to light on how terrorist organizations are funded using digital assets calling out exchange failures to flag transactions going to terror groups and cybercriminals.
It should be noted that the allegations of millions of dollars worth of cryptocurrencies used to fund terrorist groups have been disproven by multiple on-chain analytics firms.
Sequel to the Oct 7 attacks, the Wall Street Journal released a report claiming terrorist organizations get funding through digital assets in millions of dollars. Meanwhile, several firms like Chainalysis have called the report overstated while calling on efforts to stop all terror funding.
🤔 Chainalysis Highlights Flawed Analysis in Assessing Crypto’s Role in Terror Financing
Blockchain analytics firm @chainalysis raises concerns over the accuracy of reports regarding the extent of cryptocurrency’s role in terrorist financing. #CryptoNews https://t.co/vLgNf6E4Gj
— Cryptonews.com (@cryptonews) October 19, 2023
Digital asset firms intensify lobby moves
The Senator added that Congress has introduced several legislations to address anti-money laundering issues and other concerns but industry leads are focused on delaying or denying the née rules in lobby attempts.
According to Politico, the sector is flexing a weapon that includes contacts in law enforcement to push its interests. Recently, Coinbase has been a big leader against unclear regulations in the United States making efforts to shape rules through court and Congress.
The company has spent $2.16 million in crypto lobby efforts alongside other companies’ efforts to develop regulations to protect all parties. Kristin Smith, the head of the blockchain association, underscored the aim of creating a common sense framework which differs from Warren’s allegations in the letter.
“Our goal is to engage directly with policymakers, build relationships, and bridge the education gap to build a commonsense regulatory framework.”
Ethical issues in crypto lobbying
Finally, she stressed the ethical issue of former policymakers jumping on private companies to drive legislation through Congress.
Per the latter, although Congress has introduced legislation to eliminate the loopholes in present lobby laws and the revolving door practice, citizens deserve to know the extent to which crypto firms are using the practice to fight efforts in anti-money laundering laws.
Sen. Warren requested information on the number of former military, and civil servants employed by the association alongside their roles and related code of ethics for contacting former government officials.