In response to the Hamas attacks on Israel in October, a group of bipartisan US senators has introduced the Terrorism Financing Prevention Act. The legislation aims to tighten regulatory actions against terror groups by countering the use of cryptocurrency for funding purposes.
Led by Senators Mitt Romney, Mark Warner, Mike Rounds, and Jack Reed, the bill seeks to expand sanctions on foreign parties that facilitate financial transactions with terrorists, including the designation of all US-designated Foreign Terrorist Organizations (FTOs), such as Hamas.
Sanctions For Foreign Banks And Crypto Transactions? As announced by the US Senator for Utah state, Mitt Romney, the Terrorism Financing Prevention Act addresses the emerging threat of digital assets and their potential role in financing terrorism. It empowers the US Department of the Treasury to identify foreign banks and digital asset transaction facilitators that knowingly engage in transactions with FTOs or related parties.
According to the press release, sanctions, such as restrictions on using US correspondent bank accounts or digital asset transactions with US persons, will be imposed on these identified actors.
The legislation also incorporates a provision from the previously introduced Crypto-Asset National Security Enhancement and Enforcement (CANSEE) Act, granting the Financial Crimes Enforcement Network (FinCEN) the authority to restrict transactions involving “primary money laundering concerns” that do not involve a US correspondent bank account. Senator Romney stated:
The October 7 attacks on Israel perpetrated by Hamas have made it more urgent and necessary for the U.S. to counter the role that cryptocurrency plays in the financing of terrorism. Our legislation would expand financial sanctions to cover all terrorist organizations—including Hamas—and it would equip the Treasury Department with additional resources to counter terrorism and address emerging threats involving digital assets
This provision equips FinCEN with the necessary tools to address threats related to digital assets and non-traditional finance networks.
Integrity Of US Financial System In Fight Against Terrorism To support the effective implementation of these programs, the Terrorism Financing Prevention Act authorizes the required resources for the Treasury Department. The bill emphasizes the need to protect the integrity of the US financial system from terrorist organizations, including Hamas, and their reprehensible acts.
By tightening regulations and imposing sanctions on foreign entities involved in facilitating transactions with FTOs, the senators aim to disrupt terrorist financing networks. In this regard, Senator Rounds claimed:
It is critical that the Department of the Treasury has the necessary counter-terrorism tools to combat modern threats. The Terrorism Financing Prevention Act takes common sense steps toward rooting out terrorism by sanctioning foreign financial institutions and foreign digital asset companies that assist them in committing these heinous acts.
The total crypto market cap’s rebound on the daily chart. Source: TOTAL on TradingView.com Featured image from Shutterstock, chart from TradingView.com
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Ronaldo Marquez Ronaldo is a seasoned crypto enthusiast with over four years of experience in the field. He is passionate about exploring the vast and dynamic world of decentralized finance (DeFi) and its practical applications for achieving economic sovereignty. Ronaldo is constantly seeking to expand his knowledge and expertise in the DeFi space, as he believes it holds tremendous potential for transforming the traditional financial landscape.