Cryptocurrency Under Fire: US Senators Combatting Its Use In Child Exploitation

A campaign is underway in the United States to crack down on individuals who use cryptocurrency to buy and sell child sexual abuse material (CSAM).

U.S. Senators Elizabeth Warren and Bill Cassidy are pushing for federal agencies to be fully equipped to track crypto transactions associated with the sale of child abuse content.

As part of the effort to combat CSAM, the Departments of Justice (DOJ) and Homeland Security (DHS) have been asked to disclose their current technical capabilities.

Additionally, the senators referenced a Jan 2024 Chainalysis study that indicated a rise in the use of cryptocurrency in the illicit trade of CSAM.

According to the study, sellers of child abuse materials are utilizing “mixers” and “privacy coins” like Monero to launder their profits and avoid detection by law enforcement.

According to Chainalysis, CSAM vendors have used instant exchangers significantly more recently to convert to Monero.

However, the senators wrote to Attorney General Merrick Garland and Secretary of Homeland Security Alejandro Mayorkas, asking what the DOJ and DHS can do now to find and punish these crimes.

Cryptocurrency: Aiding Money Laundering

Moreover, the current rules and methods for stopping money laundering have trouble effectively finding and stopping these crimes.

The letter had six questions. Three were about whether federal agencies found cryptocurrency connected to CSAM, and the others were about whether we need new tools to catch and punish people who sell and buy it. The senators asked for answers to the questions by May 10.

The DOJ can now better investigate crypto transactions. Because of this, they charged KuCoin, a crypto exchange, and two of its founders.

On March 26, the DOJ accused KuCoin and its two founders of working together to run a money-transferring business without a license and breaking the Bank Secrecy Act, or BSA.

“The defendants didn’t put in place simple Anti-Money Laundering rules. So, KuCoin ran in the dark corners of the money world, letting bad money sneak in and hide.”

However, the Justice Department says KuCoin got over $5 billion and sent over $4 billion of “suspicious and criminal funds.”

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The author’s views are for reference only and shall not constitute any investment advice. Please ensure you fully understand and assess the products and associated risks before purchasing.

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