Blockchain Can Aid Action Against Criminals – Crypto News – Crypto News
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Blockchain Can Aid Action Against Criminals – Crypto News

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The United States can benefit from blockchain technology if regulators embrace its “transparency, speed and programmability,” Chainalysis Co-founder and CEO Jonathan Levin told the Senate Banking Committee Wednesday (July 9).

Speaking during the committee’s hearing, “From Wall Street to Web3: Building Tomorrow’s Digital Asset Markets,” Levin said that this sort of regulation would enhance both market integrity and innovation, according to prepared remarks provided to PYMNTS by Chainalysis, which is a blockchain data company that helps firms and public sector agencies combat illicit activity.

“All forms of value will be transferred using this technology,” Levin said of blockchains. “We are here to prevent abuse and pave the way for all people, businesses and governments to leverage it safely.”

A policy framework should acknowledge that blockchain introduces a fundamentally new model for financial oversight and that the oversight of the system should be built on publicly available information, Levin said.

“The consideration of different types of activity and risks should first use all the available information of how these mechanisms work and the relative transparency and risks that are associated with these mechanisms,” he said in his prepared remarks.

In addition, government agencies must be equipped to tackle different types of risks, understand the risks and mitigations around smart contracts and decentralized infrastructure, leverage blockchain’s transparency and available real-time data, and design compliance regimes for all institutions, Levin said.

“Government agencies with the right mandates and focus on public-private partnerships will lead to the type of financial market infrastructure that all market participants are looking for,” he said.

Levin also told the committee that blockchain enhances the ability to act quickly against illicit actors by following the money, freezing assets and seizing them. He highlighted a case in which crypto exchange OKX, stablecoin issue Tether and the United States Secret Service collaborated to freeze and seize $225 million in assets from illicit actors.

“The traceability and programmability of these assets is a key benefit in acting quickly against illicit actors,” Levin said.

The Senate hearing for which Levin prepared these remarks was focused on blockchain technology and digital assets, and the development of a framework that would provide clarity to innovators and protections to investors, Senate Banking Committee Chairman Tim Scott (R-S.C.) said in his opening statement.

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