A cybersecurity consultant told U.S Senators at a Senate Judiciary Subcommittee on Crime and Terrorism hearing on Tuesday that foreign actors could potentially use digital currencies to meddle with elections in the United States, according to Bloomberg. During the hearing, DarkTower’s Scott Dueweke said that the very nature of digital assets makes them ideal for money laundering, and provides the anonymity foreign meddlers seek:
“Digital money can move through a huge matrix of exchangers, converting from fiat-to-centralized virtual currencies-to cryptocurrencies and so on from any part of the planet to another. These systems can effectively be used as virtual money laundering nodes, and tracking a knowledgeable user through these systems (especially if outside of Western regulation) can quickly become impossible.”
Dueweke also noted that the most serious threat comes from coins like Monero and others that have been specifically designed as “privacy coins.” He reminded his listeners that other experts had previously said that coins like Bitcoin were not the first choice for criminal actors:
“In 2015, Ed Lowery, U.S. Secret Service Deputy Assistance Director said that criminals are less likely to use crypto-currencies like Bitcoin, since Bitcoin displays all of its transaction data in the public ledger of the blockchain, making it possible to follow its movement.”
Dueweke concluded his testimony by recommending that government focus on improving identity authentication for campaign contributions. He urged them to work to create a “cooperative environment” by partnering with foreign law enforcement, regulators, and private groups to establish better processes for verifying identities, while encouraging digital currencies that are committed to proper compliance with the law.
“We need to take strong steps to understand, control, and counter the risks while encouraging the growth of new virtual currency systems that are governed by the rule of law. The world is changing and we must change with it. Identity is the key.”