Elizabeth Warren: Update Bank Secrecy Act to Address Crypto 'Threat'

U.S. Senator Elizabeth Warren (D-Mass.) has called for the country's Bank Secrecy Act to be updated to address the "threat" of crypto.

"What we need to do is we need to update it again because there's a new threat out there. It's crypto," Warren told CNBC Squawk Box, claiming that cryptocurrency is used for terrorist financing and drug trafficking.

She added that North Korea has used crypto to "pay for about half of its nuclear weapons programme," reiterating a claim she made at a Senate banking committee hearing earlier this week. "We can't allow that to continue," she said.

Warren doubled down on her call for greater oversight of the crypto industry in a tweet, stating that enforcing anti-money laundering rules against crypto was "common sense & critical," and a matter of national security.

"When it comes to banking policy, I don’t usually agree with the CEOs of multi-billion dollar banks," she said, referencing Jamie Dimon's testimony during this week's Senate banking committee hearing, in which the JP Morgan CEO said that he was "always opposed to crypto," and urged the government to "close it down."

The Bank Secrecy Act requires U.S. financial institutions to provide assistance to government agenices in reporting and preventing money laundering, tax evasion and other criminal activities.

Warren and crypto

Warren has past form when it comes to associating crypto with criminal activity; in June 2023 she linked crypto to the fentanyl trade, while in an October 2023 letter to the Treasury department and the White House, she claimed that terrorist groups including Hamas and Palestinian Islamic Jihad had "raised over $130 million in crypto."

Some of Warren's claims have been called into question; in a blog post, blockchain analytics firm Elliptic accused Warren of misrepresenting its research into terrorist financing, stating that, "There is no evidence to support the assertion that Hamas has received significant volumes of crypto donations."

Warren's claim regarding North Korea, in which she states that "more than $3 billion in crypto" has been stolen by North Korean hackers over the past five years, tallies with figures from the 2023 Crypto Crime Report from blockchain analytics firm Chainalysis. The report indicates that just under $3.2 billion has been stolen by North Korea-linked hackers since 2018.