Investing.com - Crypto-currencies, whether Bitcoin, or other lesser known altcoins, have often been cited as a potential way for Russia to circumvent international sanctions put in place following the outbreak of war in Ukraine.
However, Christopher Wray, the director of the FBI, said yesterday that crypto-currencies are far from the best way for Russia to circumvent international sanctions.
At a Thursday hearing of the Senate Select Committee on Intelligence, New Mexico Senator Martin Heinrich asked the FBI director whether Russia could respond to the economic impact of the US ban on the country's oil and gas imports by using gold reserves, Chinese currency or crypto-currencies.
Director Wray said the FBI and its partners had "accumulated significant expertise" on cryptocurrencies, citing the department's recent work in seizing large amounts of cryptos as evidence that there were vulnerabilities in the use of crypto to circumvent sanctions.
"The ability of the Russians to circumvent sanctions with crypto-currencies is probably very overrated on the part of perhaps them and others," Wray said.
"We are, as a community and with our partners abroad, much more effective at this than I think they sometimes appreciate, and there is a lot of expertise in terms of tools and strategies to help block this kind of effort. At the end of the day, what they really need to do is have access to some form of fiat currency, which is becoming more difficult."
Recall that following Russia's invasion of Ukraine on 24 February, the US and EU governments announced sanctions aimed at financially harming the country.
Numerous agencies and departments, including the US Financial Crimes Enforcement Network and the European Commission, said they would look into the possibility of Russia using cryptocurrencies to circumvent the sanctions. US President Joe Biden also signed an executive order on Wednesday to create a regulatory framework for cryptocurrencies that also addresses the issue.