An officer from the secret service of the USA has declared to the Congress that they would need to address the situation of privacy and anonymity based cryptocurrencies to prevent them being used for illegal purposes, such as money laundering and terrorism funding. This would mark the first time that this intelligence institution touches the subject of cryptocurrencies, according to an article published by Forbes.
The United States Secret Service in an organization better known for being in charge of the safety of the national leader, the president of the United States, with their officers serving as his personal bodyguards. But they also have the duty of conducting criminal investigations to protect the economic system of the United States. Is following this line of duty that they can propose these ideas to advise members of the Congress.
A top official of the Secret Service, Robert Novy, was summoned to give a declaration to the Subcommittee on Terrorism and Illicit Finance, where he addressed the issue of the use of cryptocurrencies to facilitate illicit activities through the internet. He stated bluntly that cryptocurrencies are the preferred method of financing crime-related activities due to the relative anonymity that users can enjoy using them as a mean of payment.
But he also states that the Secret Service has already adapted to the increasingly common use of certain cryptocurrencies like Bitcoin and Ethereum for these criminal purposes, and have also confiscated more than 28 million dollars as a result of criminal investigations.
But, the thing that most troubles Novy is the existence and use of privacy based coins, a type of cryptocurrencies that have protocols designed to make sure that the identities of the two people involved in a transaction remain secret, like Monero or Zcash. He stated:
“WE SHOULD ALSO CONSIDER ADDITIONAL LEGISLATIVE OR REGULATORY ACTIONS TO ADDRESS POTENTIAL CHALLENGES RELATED TO ANONYMITY-ENHANCED CRYPTOCURRENCIES, SERVICES INTENDED TO OBSCURE TRANSACTIONS ON BLOCKCHAINS (I.E. CRYPTOCURRENCY TUMBLERS OR MIXERS) AND CRYPTOCURRENCY MINING”
This is not new, because earlier this month Japan called to ban these types of cryptocurrencies from their exchanges to avoid them being used for illicit activities also. He concluded by saying that “those that seek to further their illicit activities through the use of digital currencies should have no illusions that they are beyond the reach of the law”. The whole statement can be read here.