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Washington, D.C. – House Foreign Affairs Committee Lead Republican Michael McCaul sent a letter to Office of the Director of National Intelligence (ODNI) Director Haines requesting more information on what extent Russia could use digital assets, such as cryptocurrencies, to avoid sanctions. 

“During the House Permanent Select Committee on Intelligence’s hearing on March 8, 2022, you noted that in regard to Russia, cryptocurrencies are ‘…a concern in relation to trying to avoid sanctions,’ but that your assessment was that it would be ‘challenging’ for Russia to completely undermine sanctions through the use of cryptocurrencies,” Rep. McCaul wrote. “While I agree with your assessment, I am concerned with any extent Russia could use cryptocurrencies or other digital assets, such as stablecoins, CBDCs, and NFTs, to avoid sanctions. It is important to understand any impact that digital assets have on U.S. sanctions and address challenges to their impact in a forward leaning manner.

The full text of the letter can be found here and below. 

Dear Director Haines,

During the House Permanent Select Committee on Intelligence’s hearing on March 8, 2022, you noted that in regard to Russia, cryptocurrencies are “…a concern in relation to trying to avoid sanctions,” but that your assessment was that it would be “challenging” for Russia to completely undermine sanctions through the use of cryptocurrencies. While I agree with your assessment, I am concerned with any extent Russia could use cryptocurrencies or other digital assets, such as stablecoins, CBDCs, and NFTs, to avoid sanctions. It is important to understand any impact that digital assets have on U.S. sanctions and address challenges to their impact in a forward leaning manner.

For instance, it is reported that North Korea has used stolen cryptocurrency to fund its nuclear program and that Iran uses cryptocurrency mining to prop up its sanctioned economy. While neither North Korea nor Iran can completely avoid the impact of U.S. sanctions using digital assets, all incidences of sanctions evasion by malign actors are of concern. As such, I am interested to learn more about the details of your assessment on Russia’s ability to evade sanctions using digital assets, specifically:

  1. Have you seen any indications thus far that Russia is using digital assets to evade sanctions? If so, to what extent?

  2. To what extent can Russian officials and oligarchs use digital assets, like cryptocurrency, to evade sanctions as individuals?

On March 9, 2022, President Biden released Executive Order 14067 directing your office to work alongside the Treasury Department to develop a report addressing the foreign policy and national security implications that digital assets have and requesting that your office submit

supplemental annexes “

  1. To what extent will the report and annex reflect cooperation with foreign partners?

  2. To what extent will the report involve cooperation with digital asset trading platforms?

  3. Will this report identify a lead government entity for coordinating policy on digital assets

    and their use in sanctions evasion?

I look forward to working alongside your office to strengthen U.S. foreign policy tools and ensure that Russia and other malign foreign actors cannot evade sanctions through the use of digital assets. If your staff has any questions, please have them contact House Foreign Affairs Committee staffer Taryn Woody at Taryn.Woody@mail.house.gov or (202) 226-8467.

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