U.S. Treasury Undersecretary Nellie Liang said there’s been a rise in digital assets enabling illegal financial transactions since the Russian invasion of Ukraine, but the volume is too low to help Moscow elude sanctions.
“The transaction size we’ve seen is fairly small,” Liang told Reuters Friday (March 18). “Of course, we recognize we may not see everything, but there is a fair amount of oversight. At this point, we just don’t see that it could be used in a large-scale way to evade sanctions.”
The head of the department’s domestic finance division said the U.S. Treasury has been investigating the issue for years. She noted that the Group of Seven has also raised concerns about the use of cryptocurrency for criminal finance, referring to G-7, an intergovernmental organization comprising the United States, France, Germany, Italy, Japan, the United Kingdom and Canada.
“People are very aware of it, and paying attention to it,” she said. “While it’s growing because the use of crypto is growing, its share as a medium for illicit finance is not anywhere as large as just using cash.”
Earlier this month, four Democratic U.S. senators wrote to Treasury Secretary Janet L. Yellen and asked her to explain how the department will convince cryptocurrency companies to enforce economic sanctions on Russia.
Read more: Senators Ask Treasury to Probe if Russia Can Use Crypto to Get Around Sanctions
The letter, from Sens. Elizabeth Warren, D-Mass., Mark Warner, D-Va., Sherrod Brown, D-Ohio, and Jack Reed, D-R.I., also asked the Secretary whether decentralized financial structures were hindering sanctions enforcement.
The senators said they were concerned that Russia could turn to digital assets such as cryptocurrency or its digital ruble to help ease the pressure of the economic sanctions being imposed.
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