Foreign-owned crypto mining businesses operating in the United States have raised concerns from Senator Elizabeth Warren (D-Mass.) on potential hazards to national security.
What Happened: During her questioning of Paul Rosen, Assistant Secretary for Investment Security at the Department of the Treasury, Warren—who is well-known for her critical stance on the cryptocurrency industry—highlighted a number of hazards.
Warren claimed that these mining activities might be used for espionage, grid disruption, and secret financial transactions during a hearing on Thursday of the Senate Committee on Banking, Housing, and Urban Affairs.
She said that our enemies might use cryptocurrency mining to covertly transfer money into and out of the nation, spy on military installations, or bring down the power grid.
A third of U.S.-based cryptocurrency mining businesses are owned by Chinese nationals, some of whom have direct connections to the Chinese government, according to a research referenced by the senator from a blockchain analytics firm.
She cited a recent situation in which President Joe Biden prohibited a Chinese-majority-owned mining business from operating near a Wyoming Air Force facility owing to national security concerns.
Rosen acknowledged the possible concerns, saying, “Of course, an impact on our energy sector, our energy resources, and our energy supply chain could have a significant national security impact.”
Warren also expressed concern about foreign nationals’ capacity to circumvent traditional banking systems by purchasing mining operations with crypto, potentially violating anti-money laundering regulations.
Saying, “It’s time for us to pass laws, laws that the Treasury needs,” she demanded more robust legislation to deal with these problems.
Warren is strongly assembling what she refers to as a “anti-crypto army” as part of her reelection campaign, at the time of this conversation.
Crypto enthusiasts have taken issue with her position, and pro-crypto attorney John Deaton has declared his intention to run against her in the next Senate election.
The delicate relationship between national security, regulatory supervision, and cryptocurrencies is highlighted by the senator’s concerns.
These concerns will probably stay at the top of policy conversations as long as the business is evolving.
