Senators aim to increase oversight of cryptocurrency mining with new bill

Sens. Maggie Hassan (D-N.H.) and Joni Ernst (R-Iowa) introduced legislation Monday intended to increase oversight of cryptocurrency mining overseas.

The bill would require the Treasury Department to compile and submit to Congress a report on how nations are using and mining cryptocurrency, along with how much cryptocurrency has been mined since 2016 within both the U.S. and countries including China. 

In addition, Treasury would be required to examine the impact of cryptocurrency mining on supply chains for critical resources such as semiconductors, the global shortage of which has caused major disruptions in production for products including automobiles. 

“In order to strengthen U.S. competitiveness, our government must get a better handle on the role that cryptocurrency is playing in the global economy and how it is being leveraged by other countries,” Hassan said in a statement Monday. 

“I’m glad to partner across the aisle with Senator Ernst to help ensure that the Treasury Department stays on top of the use of cryptocurrency, including how it can impact our supply chains,” she added. 

Concerns around cryptocurrency regulation have increased on Capitol Hill in recent months, with debate over cryptocurrency-related amendments delaying the Senate’s $1 trillion infrastructure package in August. 

Cryptocurrency markets have also come under scrutiny due to escalating ransomware attacks, with cyber criminals often using these markets to facilitate payments from victims. 

Recent ransomware attacks have included those on Colonial Pipeline and JBS USA, with both companies choosing to pay the ransom in bitcoin, though the majority of the funds paid by Colonial were recovered by the Justice Department. 

As a result, the federal government has taken action, with the Justice Department issuing its first sanctions against a virtual currency exchange last week due to the cryptocurrency exchange SUEX OTC allegedly facilitating ransomware attack payments. 

China’s central bank went one step further last week when it ruled all cryptocurrency transactions illegal due to security concerns and the use of cryptocurrency exchanges in criminal activities. 

Hassan earlier this month sent letters to several federal agencies detailing her concerns around the use of cryptocurrency markets to facilitate criminal acts, including for ransomware attack payments. 

“The anonymity provided by cryptocurrency has helped facilitate its use by criminals in a myriad of ways,” Hassan wrote in the letters. “These uses include drug sales over the dark web, payments for ransomware attacks, tax evasion, financing for terrorism and organized crime, money laundering, and more.”