The U.S. Department of Justice announced significant actions regarding digital assets, including the public release of its report, pursuant to the President’s March 9 Executive Order on Ensuring Responsible Development of Digital Assets, on The Role of Law Enforcement in Detecting, Investigating, and Prosecuting Criminal Activity Related to Digital Assets; and the establishment of the nationwide Digital Asset Coordinator (DAC) Network, in furtherance of the department’s efforts to combat the growing threat posed by the illicit use of digital assets to the American public.
“As digital assets play a growing role in our global financial system, we must work in tandem with departments and agencies across government to prevent and disrupt the exploration of these technologies to facilitate crime and undermine our national security,” said Attorney General Merrick B. Garland. “The efforts announced today reflect the commitment of the Justice Department and our law enforcement and regulatory partners to advancing the responsible development of digital assets, protecting the public from criminal actors, and meeting the unique challenges these technologies pose.”
The White House released a FACT SHEET regarding cryptocurrency. From the Fact Sheet:
…Digital assets pose meaningful risks for consumers, investors, and businesses. Prices of this assets can be highly volatile: the current global market capitalization cryptocurrencies is approximately one-third of its November 2021 peak. Still, sellers mislead consumers about digital assets features and expected returns, and non-compliance with applicable laws and regulations remains widespread. One study found that almost a quarter of digital coin offerings had disclosure or transparency problems – like plagiarized documents or false promises of guaranteed returns. Outright fraud, scams, and theft in digital asset markets are on the rise: according to FBI statistics, reported monetary losses from digital asset scams were nearly 600 percent higher than in 2021 than the year before…
The Wall Street Journal reported that the Justice Department has tapped more than 150 federal prosecutors across the country to bolster law enforcement’s efforts to combat the rise in crime linked to the use of cryptocurrencies, such as bitcoin, officials said.
According to The Wall Street Journal, The Digital Asset Coordinators Network is intended to designate subject-matter experts in U.S. attorneys’ offices on the complex and technical and legal complications posed by cryptocurrency cases, the officials said.
Regulators, lawmakers and law-enforcement officials have said some cryptocurrency platforms afford users anonymity that helps them to launder criminal proceeds, finance terrorism, or engage in public corruption. Sanctions and other tools have been deployed with more frequency in recent months, but criminal prosecutors remain a key part of the administration’s strategy to police against bad actors, The Wall Street Journal reported.
Personally, I can see why it is necessary for the federal government to crack down on cryptocurrency, especially since it has been used in frauds, scams, and theft. It will be interesting to see how effective The Digital Asset Coordinators Network will be on cracking down on cryptocurrency.