The House Financial Services Subcommittee on Digital Assets, Financial Technology & Inclusion convened the afternoon of Wednesday, November 15th, to discuss illicit activity in regards to cryptocurrency.
“We know that bad actors prey on vulnerabilities wherever they can find them,” said Chairman House Financial Services Chairman Patrick McHenry (NC-10). “There’s a bipartisan agreement, though, that we must hold these bad actors to account in every way possible and, specifically, when it comes to digital assets and the digital asset ecosystem.”
The subcommittee meeting comes a little over a month after an October 7th attack by the militant group, Hamas, saw 1200 Israelis killed.
According to BitOK, a financial audit company based out of Tel Aviv, Hamas received approximately $41 million in crypto wallets between August 2021 and June 2023.
Understanding the technology
“Members in this room must better understand the degree of illicit activity, learn how we can use Blockchain technology to combat illicit activity, examine the analytic tools that are currently available to combat this activity and explore gaps that may prevent and detect illicit activity,” said Congressman French Hill (AR-02), Chairman of the Subcommittee on Digital Assets, Financial Technology & Inclusion.
The subcommittee hearing follows one held yesterday by The Senate Committee on Banking, Houses, and Urban Affairs, addressing the need for regulatory oversight in the financial sector. It comes amidst broader discussions for legislation and regulation within the crypto industry.
Witnesses included Senior Counsel and Director of Global Regulatory Matters at ConsenSys and former Associate Deputy Attorney General at the Department of Justice, Bill Hughes, former Trial Attorney, and Human Trafficking Finance Specialist with the U.S. Department of Justice’s Money Laundering and Asset Recovery Section and partner at Arktouros, Jane Khodarkovsky, and co-founder & Chief Strategy Officer of Chainalysis, Jonathan Levin, among others.
Uncovering Hamas’ footprint
Members of the House Financial Services Committee proceeded to send a letter to President Biden and U.S. Treasury Secretary Janet Yellen amidst their “bipartisan fact-finding mission” to uncover the true extent of funding terrorist organizations like Hamas receive through means of illicit cryptocurrency.
“We request the White House and the Treasury to utilize the open blockchain ledger to assess the footprint of Hamas’s digital asset fundraising campaign,” stated House Majority Whip Tom Emmer (MN-06). “In doing this, Congress can better understand the United States’ available tools and capabilities to target bad actors on blockchain and support legitimate digital asset use and innovation.”
“It’s essential that we hold bad actors in the digital asset ecosystem accountable in order for legitimate players to thrive,” added Chairman McHenry.