US Lawmaker Defends Crypto's Role Amidst Claims of Illicit Funding

US Lawmaker Defends Crypto's Role Amidst Claims of Illicit Funding 

US lawmaker Cynthia Lummis has defended crypto against claims that the digital asset is used for illicit funding. She explained that “Crypto is not the problem; bad actors that exist in every industry are.” The lawmaker pointed out that crypto accounts for less than 1% of all illicit finance activity. In addition, she has urged Congress to create a regulatory framework to allow crypto firms to operate in the US instead of driving them to “unregulated foreign markets.”

Lawmaker Stands Firm: ‘Crypto Is Not the Problem’

US Senator Cynthia Lummis (R-WY) defended crypto in response to an article on Forbes that misinformed and misguided 20% of Congress on Hamas and crypto.

“Crypto accounts for < 1% of all illicit finance activity and would be even less if we created a regulatory structure to allow the crypto industry to operate in America instead of unregulated foreign markets,” the senator from Wyoming shared her stance on the social media platform X on Friday. She messaged:

"Crypto is not the problem; bad actors that exist in every industry are."

Recently, several media organizations reported that Hamas had amassed millions through cryptocurrency. But blockchain analytics company Elliptic debunked the reports, stating, “There is no evidence to suggest that crypto fundraising has raised anything close to this amount, and data provided by Elliptic and others has been misinterpreted.”

Despite efforts by Elliptic to rectify misinformation, these reports prompted 100 US lawmakers, including Senator Elizabeth Warren, to urge the Biden administration to confront crypto-based funding of terrorism.

Enhanced Tools to Combat Illicit Crypto Use 

This week, US Deputy Secretary of the Treasury, Wally Adeyemo, explained that the Biden administration is in pursuit of enhanced tools to combat the illicit use of crypto. While acknowledging the increased focus on the illicit financial use of digital assets due to recent attacks on Israel, he admitted that crypto is not a major source of funding for terrorist organizations.

Blockchain analytics firm Chainalysis's February report reveals that “crime as a share of all crypto activity is still trending downward.” Moreover, the published report mentioned:

"Overall, illicit activity in cryptocurrency remains a small share of total volume, at less than 1%."

What is your take on the statements by Senator Cynthia Lummis about crypto and illicit finance? Please share your thoughts and opinions in the comments section below.