July 21 (UPI) — Sen. Gary Peters, chairman of the Senate Committee on Homeland Security and Governmental Affairs, announced Tuesday an investigation into the role cryptocurrencies play in encouraging cybercrime.
In a statement, Peters, D-Mich., noted that ransomware attacks, in which hackers illegally obtain or lock company data and charge a ransom for it to be restored, increased 150% from the previous year in 2020, with more than $412 million in cryptocurrencies paid to cybercriminals.
“The increased use of cryptocurrencies as the preferred method of payment in ransomware attacks shows that cybercriminals believe they can commit attacks without being held accountable,” Peters said. “These attacks can have a devastating effect on Americans’ lives and livelihoods and we must do everything we can to deter them — including understanding what additional regulations, actions and reforms are needed to adequately tackle complicated cybersecurity threats.”
Peters said the investigation will examine the rise in ransomware attacks, how cryptocurrency emboldens cybercriminals and what steps lawmakers and federal regulators can take to disrupt hackers from committing crimes to obtain cryptocurrencies.
It will also examine current oversight and regulations into virtual currencies and how to ensure that Americans can safely access and benefit from cryptocurrencies.
Last month, meat producer JBS said it paid $11 million in cryptocurrency ransom after a cyberattack shuttered its meat processing plants in the United States and Australia and the Colonial paid $4.4 million in cryptocurrency after its pivotal Colonial Pipeline was shut down by a cyberattack but much of it was recovered by the Justice Department.
In February, Treasury Secretary Janet Yellen described bitcoin, one of the most popular cryptocurrencies, as highly speculative and “inefficient” adding that it is often used for illegal transactions.
The Treasury Department in May also said it will require all transfers worth at least $10,000 to be reported to the Internal Revenue Service in a bid to crack down on cryptocurrency scams.