Task Force Pushes Biden Administration to Tighten Cryptocurrency Regulation

A public-private task force has submitted a report to the Biden administration that includes recommendations to tighten the regulation of cryptocurrencies, including bitcoin, with the aim to combat ransomware. “The cryptocurrency sector that enables ransomware crime should be more closely regulated,” the task force wrote.

White House Urged to Tighten Crypto Regulation

A task force, organized by the Institute for Security and Technology, submitted a report entitled “Combating Ransomware” to the Biden administration Thursday with 48 recommendations, some of which aim at tightening crypto regulation.

The recommendations were developed by the Ransomware Task Force (RTF), which the report describes as “a broad coalition of volunteer experts from industry, government, law enforcement, civil society, cybersecurity insurers, and international organizations.” Its goal is to “provide a strategic framework for a systemic, global approach to mitigating the ransomware problem.”

The report claims that “Ransomware payments are typically made in cryptocurrency,” which “are difficult to trace.” One of the “Priority recommendations” outlined in the report reads:

The cryptocurrency sector that enables ransomware crime should be more closely regulated. Governments should require cryptocurrency exchanges, crypto kiosks, and over-the-counter (OTC) trading ‘desks’ to comply with existing laws, including Know Your Customer (KYC), Anti-Money Laundering (AML), and Combatting Financing of Terrorism (CFT) laws.

The report elaborates on some crypto-related recommendations, such as to “Develop new levers for voluntary sharing of cryptocurrency payment indicators,” “Incentivize voluntary information sharing between cryptocurrency entities and law enforcement,” and “Centralize expertise in cryptocurrency seizure, and scale criminal seizure processes.”

“The use of cryptocurrency adds to the challenge of identifying ransomware criminals, as payments with these currencies are difficult to attribute to any individual,” the report details. “Ransomware criminals can also obscure their transactions through cryptocurrency ‘mixing services.'” It also notes that some groups will also demand payment in privacy coins, such as Monero. However, the task force pointed out that currently, these coins “are not as liquid as Bitcoin and other cryptocurrencies.”

Members of the RTF include the U.S. Federal Bureau of Investigation (FBI), U.K. National Crime Agency (NCA), and representatives from the U.S. Secret Service (USSS), U.K. National Cyber Security Centre (NCSC), and the Royal Canadian Mounted Police’s National Cybercrime Coordination Unit.

“Ransoms paid by private firms siphon millions of dollars toward criminal enterprise every year,” the report adds, noting that “The total amount paid by ransomware victims increased by 311% in 2020, reaching nearly $350 million worth of cryptocurrency.”