The U.S. needs to ramp up its coordination with other nations to investigate and combat crimes involving digital assets, the Department of Justice said in a new report.
The DOJ report called for more international collaboration to address “unique obstacles” posed by cryptocurrencies and other digital assets, such as the user anonymity and speed of cross-border payments.
The increased use of digital assets “increases the risk of crimes,” including money laundering, ransomware, terrorist financing, fraud, theft and sanctions evasion, according to the report released Monday.
“Strengthening international law enforcement cooperation for detecting, investigating, prosecuting, and otherwise disrupting criminal activity related to digital assets is vital to the mitigation of illicit finance and national security risks posed by the misuse of such assets,” the DOJ said.
The U.S. should provide funding, training and other resources to help expand international investigations into digital asset crimes, the DOJ said. The report also called on U.S. law enforcement entities to share more information with their foreign counterparts in those investigations.
“Such an initiative would ensure that the digital assets-related training and operational needs identified by U.S. law enforcement agencies are addressed in a manner that remains consistent with U.S. foreign policy and national security interests,” the report said.
The U.S. should also “promote robust compliance” of international anti-money laundering and counter-financing-of-terrorism standards, the DOJ said, in order to close gaps that could lead to jurisdictional arbitrage.
The report follows steep price declines in cryptocurrencies and other digital assets, which have triggered calls for regulation and fraud investigations. In March, President Biden directed the DOJ to produce a report on international law enforcement cooperation, as part of a sweeping executive order on digital assets.