Virtual-currency companies now have a set of Treasury Department guidelines on how to ensure they comply with U.S. sanctions, the latest salvo in an effort by the Biden administration to combat ransomware and other nefarious uses of cryptocurrencies.
“This is the beginning of a concerted effort, a shock-and-awe campaign around ransomware,” said
Ari Redbord,
a former senior Treasury adviser who now works as head of legal and government affairs at TRM Labs Inc., a company that helps organizations investigate cryptocurrency-related fraud.
The guidance and the designation of SUEX represent relatively recent steps by the Treasury’s sanctions unit into the cryptocurrency space. Another Treasury unit, the Financial Crimes Enforcement Network, has for a decade sought to clarify to cryptocurrency companies their obligations under U.S. anti-money-laundering laws, beginning with changes to rules related to money services businesses in 2011.
In creating guidance for cryptocurrency companies, the Treasury’s Office of Foreign Assets Control, or OFAC, has taken sanctions-compliance principles and practices that have long been the standard in other areas of business and tailored them to the virtual-currency sector, Mr. Redbord said.
The guidance applies to virtual-currency exchangers, administrators, miners, wallet providers and other financial institutions with ties to the industry. It contains a mix of principles that apply across industries and to more traditional currencies and specific…
