Hearing: Alternative Payments Threat to National Security Goes Far Beyond Crypto

Cryptography is just the tip of the iceberg, experts tell a House financial services subcommittee United States in testimony on payment systems and national security.

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Unencrypted alternative payment systems pose a serious security threat to the United States, according to testimony presented Tuesday at a hearing of the U.S. House Financial Services Committee subcommittee on national security, international development and monetary policy. The alternative payments ecosystem should be considered as a whole, and crypto can enhance national security, the panellists said.

Scott Dueweke, a member of the Wilson Center, told the U.S. House Financial Services Subcommittee in written testimony, "By focusing solely on cryptocurrencies, we risk missing out on the forest for the trees."

Money services businesses are heavily regulated in the United States, but those based outside the country may not want to comply with US requirements, including Know Your Customer/Anti-Money Laundering, and they may be outside from the United States and other Western countries. reporting requirements, Dueweke said.

Dueweke recommended stepping up open source financial intelligence efforts as a way to counter the threat posed by Russian and Chinese-created alternatives to the SWIFT network and other threats. He said:

"The United States must follow the global technology leadership of our private sector in setting the standards for EPA on the international stage. Regardless of which direction the U.S. government takes the digital dollar, […] it looks forward to engaging the world through international organizations.”

While political goals inspire initiatives such as the formation of projects such as Russia's financial message transfer system, a SWIFT alternative, and that country's MIR bank card system, Dueweke said poverty is the main driver for the expansion of the alternative. payment ecosystem.

A good day for doing my civic duty. pic.twitter.com/O0NlMHPR9d

— Scott Dueweke (@Scott_Dueweke) September 20, 2022