The US Treasury Department seems to be very concerned about the growing use of cryptocurrencies. Earlier this week, the ministry released a report outlining how cryptocurrencies could undermine the effects of US sanctions.
The US Treasury Department is concerned about the growing use of cryptocurrencies
As a result, cryptocurrencies would further weaken the role of the US dollar in the international market. The report comes as the Treasury Department reviews the US sanctions system. The ministry stated that “although sanctions remain an essential and effective policy tool, they also face new challenges, including the growing risk posed by new payment systems, the growing use of digital assets”.
US sanctions prevent governments, businesses or individuals from accessing US financial systems. It is further cut off from banking or trading with other top economies in the world. However, the report states that cryptocurrencies and other alternative payment platforms “offer opportunities to hold and transfer funds outside the traditional dollar financial system.”
In addition to the impact on sanctions, the Treasury Department also noted that cryptocurrencies motivate people to hide cross-border transactions and also help build new financial payment systems that intend to reduce the global role of the dollar.
Modernization of the sanction system
A recent report from the Treasury department showed that sanctions have increased tenfold in the last two decades. The ministry also noted that sanctions must have a clear purpose. In addition, they should avoid any unwanted economic and humanitarian damage and impose it in coordination with other US allies.
Deputy Finance Minister Wally Adeyemo said they were modernizing the sanctions system:
“Sanctions are a vital tool for promoting our national security interests. The Ministry of Finance’s sanctions review has shown that this effective tool continues to bear fruit, but also faces new challenges. We are committed to working with partners and allies to modernize and strengthen this vital tool. “
The report also states that “they aware of the risk that if these digital assets and payment systems remain unchecked, they could undermine the effectiveness of their sanctions”.
During his recent tour of South Africa, Cardano’s co-creator, Charles Hoskinson, also addressed the US Treasury Department. He said he was doing everything in its power to destroy the crypto assets. Hoskinson noted:
“In DC, the Treasury is doing everything in its power to try to destroy our sector. An industry worth over $ 2 trillion has emerged and my government is trying to destroy it.”