A member of the U.S. Commodity Futures Trading Commission (CFTC) is reportedly calling for an end to anonymous crypto transactions in a push to curtail illicit activity.
According to a new Reuters report, CFTC commissioner Christy Goldsmith Romero says that tighter governmental and industry controls on digital assets are needed to curtail risks to national security.
During remarks at a City Week conference in London, Romero said that criminals are turning to crypto to fund cybercrimes.
Says Romero,
“Fraud is a hallmark of digital asset markets, the human toll of which may be overlooked. It’s essential for governments and particularly the industry to address that which makes crypto so attractive to illicit finance, and that is the allure of anonymity.”
Reuters notes how the US, citing national security concerns, recently banned currency mixer Tornado Cash, which pools together funds from differing sources, mixes them up and then redistributes them to increase anonymity.
US Congress is considering new laws to address anonymity in digital assets, according to Reuters.
Says Romero,
“It’s possible for all crypto companies to distance themselves from mixers and anonymity enhancing technology while still providing customers financial privacy.”
The Financial Stability Board (FSB) is also working on final global recommendations for regulations of crypto, which would be issued “soon,” according to Reuters.
The legacy financial system continues to lead the way when it comes to money laundering. According to a report published by the United Nations Office on Drugs and Crime, over a trillion dollars are illicitly funneled through the traditional banking system every 365 days.
A recent analysis from Forbes found that banking giants including Capital One and Deutsche Bank were fined a total of $2.7 billion in 2021 for committing anti-money laundering violations. As for the crypto industry, a January report from Chainalysis found that money laundering accounted for less than one percent of all crypto transactions in 2021.
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