Sen. Elizabeth Warren, D-Mass., warned of two harmful uses of crypto in a Senate Committee on Armed Services hearing.

Warren called out the use of cryptocurrency in terrorism financing and 'pig butchering' scams where scammers gain the trust of a victim, convince the victim to give them large amounts of money and then run off with it.

Warren held the discussion with two United States armed forces leaders: Admiral John C. Aquilino of the U.S. Indo-Pacific Command and General Paul J. LaCamera, who commands United States Forces Korea. 

According to LaCamera, pig butchering involving crypto affected more than 40,000 American victims and caused the lost of $3.5 billion in 2023. Both armed forces leaders agreed that hampering criminal attempts to steal and launder crypto funds bolsters international security.

"Crypto is the way this stuff is financed," Warren said in the March 21 hearing. "And it's helping rogue states. It's helping terrorists. It's helping criminal organizations fund their operations on a scale like we have never seen before." The senator added that her bipartisan bill would "put a stop to it."

Warren's bill, called the Digital Asset Anti-Money Laundering Act, aims to stop crypto crime by beefing up U.S. financial regulation of cryptocurrency and expanding know-your-customer protocols, among other requirements.

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