Cryptocurrency Wallet Address to be added the Sanction List by US Treasury
The Treasury has set up preparation for adding particular wallet addresses to its SDN List, but the ability of the department’s approach is questionable.
On March 19, 2018, the US Department of the Treasury declared guidance about cryptocurrency sanctions imposed by its Office of Foreign Assets Control (OFAC), describing that OFAC may include the particular digital currency address to the specific Designated Nationals (SDN)
The guidance described:
“The digital currency address field on the SDN List provides the unique alphanumeric identifiers (up to 256 characters) for digital currency addresses and identifies the digital currency to which the address corresponds.”
The Treasury mentioned the names of some of the most famous cryptocurrencies and their ticker symbols as examples. They included bitcoin (BTC), Ether (ETH), Litecoin (LTC), Neo (NEO), Dash (DASH), Ripple (XRP), Iota (MIOTA), Monero (XMR), and petro (PTR).
Still, the listings “doesn’t seem to be exhaustive,” and the department helped witnesses who recognize wallets owned by SDNs to “block the relevant digital currency and file a report with OFAC .” The Treasury highlighted the importance of organizations and exchanges developing “tailored, risk-based compliance program[s],” but noted that “there is no single solution suitable for every circumstance.”
It is not yet clear whether the agency would expand its list as more blacklisted addresses continue to transact with other addresses not yet on OFAC’s radar. The Treasury might also be required to fight with cryptocurrency tumblers and mixing services, which would involve its sanction efforts.
Including OFAC guidance, the Treasury also provided descriptions of “virtual currency,” “digital currency,” “digital currency wallet,” and “digital currency address.”