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US government issues stern warning to crypto firms on illicit finance

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The U.S. government is increasing its attention on cryptocurrency firms, issuing a clear message from Deputy Treasury Secretary Wally Adeyemo: comply with regulations to prevent and report illegal money transfers or face exclusion from the wider U.S. economy. According to Crypto Briefing, Adeyemo made this warning at an event hosted by the Blockchain Association, stressing the need for the crypto industry to play a more active role in stopping unlawful financial activities.

Changpeng Zhao’s guilty plea signals a shift

Highlighting the government’s firm stance, Binance’s former CEO Changpeng Zhao recently admitted to violating U.S. anti-money laundering laws. This acknowledgment is part of a substantial $4.3 billion settlement. Zhao stepped down as CEO of the world’s largest crypto exchange following accusations of Binance’s failure to report over 100,000 suspicious transactions.

These transactions were reportedly related to terrorist organizations, including Hamas, al Qaeda, and the Islamic State of Iraq and Syria.

The government’s actions reflect a broader effort to regulate the rapidly expanding cryptocurrency market. The Biden administration has taken proactive steps, including a recent proposal to Congress for new legislation. This legislation would give the Treasury authority to oversee crypto marketplaces, particularly those used by entities viewed as unlawful by the U.S. government.

The crackdown on crypto firms aims to uphold laws and address the increasing global popularity of cryptocurrencies. This rise has attracted a mix of investors, enthusiasts, and entities looking to bypass traditional financial systems.

Despite the strict regulatory approach, Adeyemo clarified the government’s stance on innovation in the crypto space. He stated, “We are not here to stifle innovation, but to ensure that it is done in a way that protects our national security, our financial system, and the American people.” This highlights the U.S. government’s commitment to promoting technological advancement while safeguarding national security and financial stability.

The Binance case demonstrates the U.S. government’s determination to enforce compliance and accountability in the evolving cryptocurrency sector.

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