The U.S. Department of the Treasury has released a 39-page report that warns readers about the risks of decentralized finance (DeFi).
In the report, the department also urged the firms to comply with existing laws regarding anti-money laundering (AML) and terrorism financing.
- The report said the risks associated with DeFi
include the abuse by ransomware cybercriminals, thieves, scammers, and
North Korean cyber actors, addressing the risks related to national
security.
- The department pointed out that these malevolent actors use DeFi services to launder or move their illicit funds.
- The agency also suggested stricter rules for the DeFi technology and recommended some changes to the law in the report.
- The document underlined that most companies do not obey the AML and terrorism financing rules.
- The
Treasury Undersecretary for Terrorism and Financial Intelligence, Brian
Nelson, said the firms need to address those risks while taking
potential advantages of DeFi.
- The 2023 DeFi Illicit Finance Risk Assessment report was commissioned by U.S. President Joe Biden’s administration.
