U.S. Confirms Development of Cryptocurrency ‘Comprehensive Strategy’

The United States deputy attorney general has confirmed that the government is in the process of developing a “comprehensive strategy” for cryptocurrency, according to statements made this week.

Rod Rosenstein made the comments at the Financial Services Roundtable earlier this week, when responding to questions about cybercrime and its intersection with cryptocurrencies. Within his answer, he spoke of a new task force established under the Justice Department, which has the specific remit of evolving a strategy for tackling these issues.

“A lot of these schemes involve bitcoin and other cryptocurrencies which do not flow through the traditional financial system ... What we’re working on now with our cybercrime task force is a comprehensive strategy to deal with that.” 

He also confirmed that cryptocurrencies are not fully anonymous, and are instead pseudonymous, making it possible for law enforcement in future to trace transactions and identities based on the clues left behind.

“We all know there are ways to trace criminal activity. Generally speaking, it’s not just about cyberactivity, there will be other ways that people will leave trails. Ultimately, even when dealing with cybercurrency, they’re going to want to convert, launder it into physical currency, and so there are ways to trace these operations.”

The task force draws expertise from a range of law enforcement departments, including the Drug Enforcement Agency, the FBI and the U.S. Marshals Service. Their task will be to work with other agencies to shape the U.S. government’s policy response — a conclusion that could ultimately lead to attempts to increase regulation around cryptocurrency in the United States.

Yet, it remains early days for the technology. According to Rosenstein, another element of their work will be informing and educating officials on the technology, and the ways in which it can be used by criminals.

“One of the challenges we have in law enforcement is making sure our employees are fully skilled, so that’s one of our challenges, to make sure we have the agents and the prosecutors with the skills and the expertise ... Because the criminals will always be one step ahead.”