Iran's cryptocurrency mining sector has come under fire from US senators Elizabeth Warren and Angus King, who consider it a threat to national security.
In a May 1 letter to National Security Adviser Jake Sullivan, Secretary of Defense Lloyd Austin, and Treasury Secretary Janet Yellen, the senators urged the Biden administration to asked them to elaborate on their possible relationship with cryptocurrency miners.
Senators Warren and King believe that digital assets being mined in Iran are being used to evade US sanctions and fund terrorist organizations like Hezbollah. It further alleges that these funds were also used to incite a state attack on Israel in April.
Iran has been sanctioned by the United States along with other international organizations since 1979. Earlier this year, the Treasury Department's Office of Foreign Assets Control (OFAC) imposed sanctions on entities involved in the illegal export of technology from multiple U.S. companies to Iran.
“Unless we take action, Iran will continue to use cryptocurrencies to fund attacks against Israel,” the letter said.
In their letter, the two cited a report claiming that the Iranian government prefers “newly minted” Bitcoin because it is “less traceable.” It was also reported that domestic Bitcoin miners earned $1 billion in revenue in 2021.
As such, the senators are asking U.S. authorities to investigate the revenues generated by Iranian cryptocurrency miners, their potential use in money laundering, and how to address these “threats to U.S. national security.” asked them to provide data on whether they plan to do so.
Interestingly, since mining was legalized in Iran in 2019, the Iranian government has cracked down on the cryptocurrency mining sector multiple times.
In 2021, the country confiscated approximately 150,000 crypto mining equipment to address concerns of power depletion. However, this device was released in January last year.
