While responding to questions on the performance of the Treasury Department in recent times at a House Financial Services Committee hearing which was held on Wednesday, Janet Yellen, the US Treasury Sec was asked about concerns regarding the evasion of sanctions with the use of cryptocurrency by Russians. The secretary responded by assuring the House that, until now, Russian oligarchs are yet to succeed at that.
From the moment that Russia launched its initial strikes on Ukraine, several sanctions have been issued on the Russian government. The United States amongst many other nations of the world has been on close watch ensuring that the effects of the issued sanctions are duly materialized.
Amid the growing sanctions, there have been serious concerns about Russia evading sanctions by using cryptocurrency.
The reason is that using fiat currencies to fund the war will be difficult owing to the harsh effects of the stiff bans, hence making crypto the best option for the Russians to transact.
The Treasury’s Strategy on Tackling Sanction Evasion
During the course of the House hearing, Rep. Nyidia Velázquez, representing New York asked Yellen saying;
“We are concerned about the potential use of cryptocurrencies and other digital assets to evade international sanctions imposed on Russia for the illegal invasion of Ukraine, the US and other G7 nations recently pledged to work together to ensure the Russian state, its Elites, and Oligarchs will not be able to utilize digital assets to side-step these sanctions, how is the Treasury Department working to carry out this pledge?”
Janet Yellen responded to the question by noting that the Treasury Department is “monitoring for any attempts to use cryptocurrency to evade our sanctions”, an event that is yet to occur, with resources available at the disposal of the department.
Yellen also affirmed that the department is monitoring the wallet addresses of sanctioned Russians and will easily flag any transaction initiated through them.
Rep. Nyidia commended Yellen on the Treasury Department’s recent move on sanctioning Hydra, a global prominent darknet market, and Garantex, a digital currency exchange, both in Russia which is accused of enabling crimes such as cybercrime and dangerous drug use among others.