Earlier this month, Treasury Secretary Janet Yellen commented to a financial sector innovation roundtable made crypto focused statements including: “We’re living amidst an explosion of risk related to fraud, money laundering, terrorist financing, and data privacy.”
However, The 2021 Chainalysis Crypto Crime Report shows that illicit activity among cryptocurrencies fell compared to the previous year:
According to the report “In 2019, illicit activity represented 2.1% of all cryptocurrency transaction volume or roughly $21.4 billion worth of transfers. In 2020, the illicit share of all cryptocurrency activity fell to just 0.34%, or $10.0 billion in transaction volume.”
Addressing the topic of money laundering, the report states that only: “270 Service Deposit Addresses Drive 55% of Money Laundering in Cryptocurrency.” In addition, the countries receiving the laundered funds do not reflect countries that are historically involved in terror events:
In fact, there has been much disruption to terrorist organizations who tried using cryptocurrencies, including U.S. government agencies seizing more than $1 million worth of Bitcoin from wallets controlled by terrorist groups and their financial facilitators.:
It’s unclear how much recent research Secretary Yellen has done into these topics, but with Bitcoin friendly Senators, like Cynthia Lummis, will be happy to educate her further.