Senator Warren: Cryptocurrencies Are “Preferred Payment” for Child Sexual Abuse, Urges Justice Department to Take Action
U.S. Senators Elizabeth Warren and Bill Cassidy are committed to ensuring that Congress and the Administration have the tools necessary to end CSAM and hold those involved with its distribution accountable.
In a joint effort to combat illicit trafficking in child sexual abuse material (CSAM), US Senators Elizabeth Warren and Bill Cassidy wrote a letter to the US Department of Justice (DOJ) and Department of Homeland Security (DHS) expressing their concern over the alleged use of cryptocurrencies to facilitate these activities.
Alleged Link Between Cryptocurrencies and Child Sexual Abuse
In the letter, the senators highlight the “pseudonym” provided by cryptocurrencies, which they say has enabled the rapid movement of CSAM payments into the cryptocurrency world. It was also stated that both Warren and Cassidy are committed to ensuring that Congress and the Administration have the tools necessary to end CSAM and hold those responsible for its distribution accountable.
The lawmakers’ concerns are based on a January 2024 report from blockchain analysis firm Chainalysis, which identifies cryptocurrency-based CSAM sales as “a growing problem.” The report reveals that virtual currency has become the preferred payment method for buyers and sellers of commercial child sexual abuse content.
To provide some context, CSAM is the acronym for child sexual abuse material. Consisting of any visual representation, including photos, videos and computer-generated images, that involves the use of an underage person in explicit sexual acts.
Additionally, a financial trend analysis by the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) indicates a growing trend of perpetrators using convertible virtual currencies to evade detection. People who engage in CSAM trading on the Internet resort to various methods to hide their activity, the senators emphasize, including using cryptocurrency mixer services and ATMs to hide the origin of funds used in transactions and launder (conceal) profits.
The senators cite troubling findings from FinCEN, which uncovered thousands of reports of suspicious activity related to online child sexual exploitation and human trafficking crimes involving Bitcoin.
These reports allegedly identified more than 1,800 unique Bitcoin wallet addresses associated with alleged crimes, with CSAM being specifically mentioned in 95% of the cases.
Senators Demand Accountability
The senators further noted that Homeland Security investigators played a key role in the indictment of a South Korean citizen and numerous users in the United States for operating a dark web pornography site funded by Bitcoin.
However, lawmakers note that the use of cryptocurrencies in illicit CSAM trading appears to be increasing. The Chainalysis review further reveals that while the size of the cryptocurrency-based CSAM market has decreased, sellers have become more “sophisticated and resistant” to detection and withdrawals.
According to the report, Bitcoin remains the most used cryptocurrency to purchase CSAM. To address these challenges, Senators Warren and Cassidy asked the DOJ and DHS a series of questions, seeking clarification on their current assessment of the alleged cryptocurrency’s role in facilitating CSAM, the sophistication of CSAM sellers, and “unique challenges” that poses the use of cryptocurrencies as payment in these crimes.
They also ask agency measures to fight the use of cryptocurrencies, privacy coins, and obscuration methods by CSAM sellers. Senator Warren’s previous efforts include the introduction of the Digital Asset Anti-Money Laundering Act, a bipartisan bill to counter illegal activities and misuse of digital currencies.
The bill seeks to make the digital asset ecosystem more compliant with anti-money laundering and anti-terrorist financing frameworks.
By Leonardo Perez