Senators Elizabeth Warren and Angus King have asked the heads of the Department of Defense and the Department of the Treasury to explain what they're doing about Iran's crypto mining.
A letter from the lawmaker argued that the nation is relying on mining to fund itself outside of the reach of sanctions.

U.S. Sen. Elizabeth Warren (D-Mass.), one of the most prominent critics of cryptocurrency hazards, warned the top military and financial officials that Iran relies on digital assets mining as a source of revenue that can lessen the pressure from U.S. sanctions.

Warren and Sen. Angus King (I-Maine) sent a letter to Secretary of Defense Lloyd Austin, Secretary of the Treasury Janet Yellen and National Security Advisory Jake Sullivan to question what the authorities are doing about Iran's "increasingly lucrative" relationship with crypto mining that "poses a direct threat to our national security."

The letter, dated May 1, outlined Iran's status as a leading jurisdiction for bitcoin (BTC) mining and how its central bank channels cryptocurrency to fund the economy, though many of the citations were based on activity in 2021.

"Cryptomining has become such a big industry in Iran that it has strained the country’s energy grid, leading the Iranian government to temporarily suspend cryptomining several times after it was blamed for massive blackouts," the lawmakers wrote.

The senators also noted Iran's history with crypto money laundering and that government's ties to ransomware operations that work in digital assets.

Warren and King directed the officials to "describe the steps the administration is taking to address threats to U.S. national security posed by Iran’s reliance on cryptomining and cryptocurrency more generally to earn revenue and bypass sanctions."

The lawmakers' letter was sent in advance of Thursday's Senate Armed Services Committee hearing on global threats.

UPDATE (May 2, 2024, 15:57 UTC): Adds context on timing of letter in advance of hearing on threats.

Regulations Iran Elizabeth Warren Sanctions Mining Bitcoin

Jesse Hamilton

Jesse Hamilton is CoinDesk's deputy managing editor on the Global Policy and Regulation team, based in Washington, D.C. Before joining CoinDesk in 2022, he worked for more than a decade covering Wall Street regulation at Bloomberg News and Businessweek, writing about the early whisperings among federal agencies trying to decide what to do about crypto. He’s won several national honors in his reporting career, including from his time as a war correspondent in Iraq and as a police reporter for newspapers. Jesse is a graduate of Western Washington University, where he studied journalism and history. He has no crypto holdings.