Sanctions compliance considerations have always been important for cryptocurrency companies, but several recent US government actions suggest regulators are increasingly focused on the intersection between digital currencies and economic sanctions. This increased focus highlights the importance of sanctions compliance for blockchain-related companies, particularly for those considered to be US persons.
This intensified focus has been building for a number of months. For example, in March of 2018, President Trump issued an Executive Order imposing certain sanctions on the Venezuelan government-issued digital currency known as the petro.
Last week, the US Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) took another step to ramp up sanctions against malign actors using digital currency. OFAC designated two Iranian individuals who helped exchange bitcoin ransomware payments into Iranian rials on behalf of Iranians involved in the SamSam ransomware attack. In making those designations, OFAC listed specific digital currency wallet addresses associated with the designated individuals, marking the first time it has done so.